August 4, 2011 (Shirley Allen)
Mortgage interest rates plunged to their lowest level in 2011 with the 15 year fixed-rate mortgage and the 5-year ARM reaching historic lows amid a barrage of economic reports signaling a weakening economy according to Freddie Mac’s Primary Mortgage Market Survey® (PMMS).
Fixed Rate Mortgages (FRM):
Thirty year and the 15 year FRMs plunged to new 2011 lows with the 30 year FRM averaging 4.39 percent with an average of 0.8 points, down from 4.55 percent reported the previous week. The 30 year FRM averaged 4.49 percent a year earlier.
The 15 year FRM set a new historic low averaging 3.54 percent this week with an average 0.7 points, down from 3.66 percent reported the previous week, and down from 3.95 percent a year ago.
Adjustable Rate Mortgages (ARM):
ARM interest rates were mixed in the last week as the 5-year Treasury-indexed hybrid ARM also plunged to a record low averaging 3.18 percent, with an average of 0.6 points, which was down from 3.25 percent the previous week. The 5 year ARM averaged 3.63 percent a year earlier.
The 1-year Treasury-indexed ARM averaged 3.02 percent this week with an average of 0.5 points, up from 2.95 percent the previous week. A year ago, the 1 year ARM averaged 3.55 percent.
Frank Nothaft, vice president and chief economist of Freddie Mac, stated, “Treasury bond yields fell markedly after signs the economy was weaker than what markets had previously thought allowing fixed mortgage rates to follow this week with the 15-year fixed and 5-year ARM setting new historical lows. The economy grew 1.3 percent in the second quarter, which was below the market consensus forecast, and first quarter growth was cut to less than a quarter of what was originally reported. In fact, the first half of this year was the worst six-month period since the economic recovery began in June 2009. Moreover, consumer spending fell 0.2 percent in June, representing the first decline since September 2009.”
“On a positive note, there were indications that the housing market is firming. Real residential fixed investments added growth to the economy in the second quarter after subtracting from growth over the first three months of the year. The CoreLogic® National House Price Index rose for the third straight month in June (not seasonally adjusted) and was the first three-month gain since June 2010. Finally, pending existing home sales rose for a second consecutive month in June and was up nearly 20 percent from June 2010 when the housing tax credits expired,” he added.
| 30-Year Fixed Rate Mortgages | US | NE | SE | NC | SW | W |
|---|---|---|---|---|---|---|
| Average | 4.39 | 4.38 | 4.40 | 4.40 | 4.43 | 4.37 |
| Fees & Points | 0.8 | 0.7 | 0.9 | 0.7 | 0.8 | 0.8 |
| 15-Year Fixed Rate Mortgages | US | NE | SE | NC | SW | W |
|---|---|---|---|---|---|---|
| Average | 3.54 | 3.53 | 3.55 | 3.52 | 3.62 | 3.51 |
| Fees & Points | 0.7 | 0.7 | 0.8 | 0.6 | 0.6 | 0.7 |
| 5/1-Year Adjustable Rate Mortgages | US | NE | SE | NC | SW | W |
|---|---|---|---|---|---|---|
| Average | 3.18 | 3.27 | 3.07 | 3.27 | 3.24 | 3.06 |
| Fees & Points | 0.6 | 0.4 | 0.7 | 0.4 | 0.7 | 0.7 |
| Margin | 2.70 | 2.75 | 2.75 | 2.51 | 2.76 | 2.73 |
| 1-Year Adjustable Rate Mortgages | US | NE | SE | NC | SW | W |
|---|---|---|---|---|---|---|
| Average | 3.02 | 3.18 | 2.77 | 3.41 | 3.02 | 2.77 |
| Fees & Points | 0.5 | 0.6 | 0.6 | 0.4 | 0.8 | 0.5 |
| Margin | 2.76 | 2.80 | 2.75 | 2.73 | 2.77 | 2.75 |
| The National Mortgage Rate Snapshot | One Year Ago | One Week Ago | ||||||
|---|---|---|---|---|---|---|---|---|
| 30-YR | 15-YR | 5/1-YR | 1-YR ARM | 30-YR | 15-YR | 5/1-YR | 1-YR ARM | |
| Average | 4.49 | 3.95 | 3.63 | 3.55 | 4.55 | 3.66 | 3.25 | 2.95 |
| Fees & Points | 0.7 | 0.6 | 0.6 | 0.7 | 0.8 | 0.7 | 0.6 | 0.5 |
| Margin | N/A | N/A | 2.74 | 2.77 | N/A | N/A | 2.74 | 2.76 |
Tags: 15 year fixed, 30 year fixed, fixed rate mortgage, freddie mac, interest rates, mortgage rates, 5-year hybrid, 1-year treasury
Source:
Freddie Mac
