Long-term mortgage rates fell slightly, but short-term rates dropped more this
week, according to Freddie Mac's weekly survey.
"Reports of weaker consumer spending in September and a decline in manufacturing
activity in October kept mortgage rates at bay this week," said Frank
Nothaft, Freddie Mac vice president and chief economist, in a news release. "Rates
for long-term mortgages were little changed while rates for ARMs fell following
the Federal Reserve's interest-rate cut." The 30-year fixed-rate mortgage averaged 6.24% for the week ending Nov. 8,
down from last week's 6.26%, according to the survey. The mortgage rate hasn't
been this low since the week ending May 17, when it averaged 6.21%. The 30-year
averaged 6.33% a year ago.
The 15-year fixed-rate mortgage averaged 5.90%, down from last week's 5.91%
average. The mortgage hasn't been this low since the week ending May 10, when
it averaged 5.87%. Fifteen-year fixed-rate mortgages averaged 6.04% a year
ago.
Greater movement was seen in adjustable-rate mortgages, following the Fed
cut.
Five-year Treasury-indexed hybrid ARMs averaged 5.89%, down from 5.98% last
week. The ARM hasn't been this low since May 10, when it also averaged 5.89%.
The ARM averaged 6.08% a year ago.
And 1-year Treasury-indexed ARMs averaged 5.50%, down from last week's 5.57%.
The ARM hasn't been this low since the week ending May 17, when it averaged
5.48%. The ARM averaged 5.55% a year ago.
To obtain the rates, the 30-year fixed-rate mortgage required payment of an
average 0.4 point, the 15-year fixed-rate and the 5-year ARM required payment
of an average 0.5 point, and the 1-year ARM required payment of an average
0.6 point. A point is 1% of the mortgage amount, charged as prepaid interest.
The low rates have helped some homeowners refinance, although
a smaller percentage of mortgage applications were for
refinancing an existing loan in the third quarter, compared
with the second quarter, according to a separate Freddie
Mac survey, Nothaft pointed out.
"With mortgage rates remaining low, approximately
38% of applications were for refinance transactions in
the third
quarter, down from 42% in the second quarter of this year.
According to Freddie Mac's third quarter cash-out refinance
report, approximately 87% of refinanced loans were for
loan amounts that were 5% or more higher than the original
balances,".
"In addition, Freddie Mac estimates that families
withdrew approximately $60 billion in home equity over
the same quarter, down from about $81 billion in the second
quarter 2007."
A separate survey released this week by the Mortgage Bankers
Association found that the number of mortgage applications
decreased 1.6% last week, mainly due to a decrease in mortgage refinance applications.
Source:
http://www.marketwatch.com/
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