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Fixed-Rate Mortgages Lowest on Record

September 29, 2011

Coming on the heels of the Federal Reserve's recent announcements, the conventional 30- and 15-year fixed rates averaged all-time record lows for the week ending Sept. 29.

According to Freddie Mac’s Primary Mortgage Market Survey, 30-year fixed-rate mortgage (FRM) averaged 4.01 percent with an average 0.7 point, down from last week when it averaged 4.09 percent. Last year at this time, the 30-year FRM averaged 4.32 percent.

Of the five regions surveyed in Freddie Mac's survey, the West region recorded the lowest average rate for the 30-year fixed dipping below 4.00 percent to 3.95 percent.

"Fixed mortgage rates fell to all-time record lows this week following the Federal Reserve's announcement of its Maturity Extension Program and additional purchases of mortgage-backed securities,” said Frank Nothaft, vice president and chief economist for Freddie Mac. “Interest rates for ARMs, however, were nearly unchanged as the Federal Reserve plans to sell $400 billion in short-term Treasury securities, which serve as benchmarks for many ARMs.

"Meanwhile, the spring and summer home-buying season gave a boost to a number of house price indexes. The Federal Housing Finance Agency reported that its National index (not seasonally adjusted) rose for the fourth consecutive month in July. Similarly, the S&P/Case-Shiller 20-City composite index, which has a broader scope of properties, rose 0.9 percent between June and July with 17 of the cities experiencing positive monthly growth. Finally, CoreLogic reported that its index, excluding distressed sales, increased at a 1.7 percent monthly rate for the same month."

Meanwhile, the 15-year FRM averaged 3.28 percent with an average 0.7 point, down from last week when it averaged 3.29 percent. A year ago at this time, the 15-year FRM averaged 3.75 percent.

The 5-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) averaged 3.02 percent, with an average 0.6 point, matching last week when it also averaged 3.02 percent. A year ago, the 5-year ARM averaged 3.52 percent.

The 1-year Treasury-indexed ARM averaged 2.83 percent with an average 0.6 point, up from last week when it averaged 2.82 percent. At this time last year, the 1-year ARM averaged 3.48 percent.



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