Property ManagementLower Mortgage Rates Translate into Large Volume of Refinancing
The 15-year FRM this week averaged 4.81 percent with an average 0.7 point, down from last week when it averaged 4.92 percent. A year ago at this time, the 15-year FRM averaged 5.25 percent.
Five-year Treasury-indexed hybrid adjustable-rate mortgages (ARMs) averaged 5.23 percent this week, with an average 0.6 point, down from last week when it averaged 5.26 percent. A year ago, the 5-year ARM averaged 5.19 percent.
One-year Treasury-indexed ARMs averaged 4.94 percent this week with an average 0.5 point, up from last week when it averaged 4.92 percent. At this time last year, the 1-year ARM averaged 5.00 percent.
"Interest rates for 30-year fixed-rate mortgages are almost 1.5 percentage points below 2008"s peak set on July 24, 2008, offering many homeowners an incentive to refinance," said Frank Nothaft, Freddie Mac vice president and chief economist. "This would translate into a monthly payment savings of around $188 on a $200,000 mortgage."
"The Bureau of Economic Analysis estimated that the weighted average mortgage rate of loans outstanding was about 6.2 percent in the fourth quarter of 2008. As a result, the share of refinancing among the total number of conventional mortgage applications has exceeded 50 percent for the past 11 weeks and averaged 80 percent over this period, according to the Mortgage Bankers Association."