Mortgage Rates Remain Favorable

Despite record low rates, mortgage and refinancing applications are down.
Mortgage rates are still near record lows. According to the Freddie Mac Primary Mortgage Market Survey, the 5-year ARM set a new all-time low this week and has fallen for the eighth consecutive time.
The breakdown for the week ending September 1:
house on top of a calculator*30-year fixed-rate mortgage (FRM): Averaged 4.22 percent, matching last week when it also averaged 4.22 percent. Last year at this time, the 30-year FRM averaged 4.32 percent.
*15-year FRM: Averaged 3.39 percent, down from last week when it averaged 3.44 percent. A year ago at this time, the 15-year FRM averaged 3.83 percent.
*5-year Treasury-indexed hybrid adjustable-rate mortgage (ARM): Averaged 2.96 percent, down from last week when it averaged 3.07 percent. A year ago, the 5-year ARM averaged 3.54 percent.
*1-year Treasury-indexed ARM: Averaged 2.89 percent, down from last week when it averaged 2.93 percent. At this time last year, the 1-year ARM averaged 3.50 percent.
“Weaker economic data reports eased upward pressure on mortgage rates this week and kept them at or near all-time record lows,” said Frank Nothaft, vice president and chief economist for Freddie Mac.
But less homeowners and home buyers are taking advantage.
According to the Mortgage Bankers Association, mortgage applications fell 9.6 percent and refinance applications dropped 12.2 percent for the week ending August 26.
“Refinance application volume declined for a second week from recent highs, despite rates staying near a 10-month low, while purchase volume remained near 15-year lows,” said Mike Fratantoni, MBA’s Vice President of Research and Economics.
The economy is uncertain, but what is certain is that mortgage rates are ideal for purchasing a new home or refinancing your current mortgage, a move that can save the average homeowner hundreds of dollars a month.