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Mortgage Rates Keep Falling

By MortgageLoan.com,  May 10, 2012, 02:20:00 PM EDT

Another week, another record low for mortgage rates. 

Interest rates on fixed-rate mortgages edged down again this week, with both 30- and 15-year fixed-rate loans reaching new record lows, according to the weekly Freddie Mac rate survey.

 

Average interest rates on 30-year fixed-rate mortgages inched down to 3.83 percent, down from last week's previous record of 3.84 percent. Meanwhile, interest rates on 15-year loans reached a record 3.05 percent, besting last week's record of 3.07 percent.

 

The rates are the lowest ever reported by Freddie Mac, which began tracking 30-year rates in 1971 and added 15-year rates in 1990.

 

Interest rates on 5-year adjustable-rate mortgages (ARMs) declined as well, but did not set a new record. Initial rates on 5-year Treasury indexed ARMs dropped to 2.81 percent, down from 2.85 percent last week. The record low of 2.78 percent was reached the week of April 19.

 

Frank Nothaft, Freddie Mac chief economist, attributed the drop in rates to a weaker-than-expected employment report for April that came out on Friday, along with the election of anti-austerity candidates in Greece and France that raised uncertainty over the stability of the Euro currency. Yields on Treasury bonds, which are seen as safe investments, fell as a result and mortgage rates followed.

 

Average interest rates on 30-year fixed-rate mortgages have now been above 4 percent only one week since early December. By comparison, one year ago this week, interest rates on 30-year mortgages were averaged 4.63 percent, while 15-year loans were at 3.82 percent and 5-year ARMs averaged 3.41 percent.

 

All figures are based on home loans with an 80 percent loan-to-value ratio.

 

This was originally published at: http://www.mortgageloan.com/mortgage-rates-keep-falling-9070 .

 

 




The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.


This article appears in: Personal Finance, Banking and Loans

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