Nov-06-2009Mortgage Rate Falls Below 5%
(topic overview)
CONTENTS:- A year ago, the 5-year ARM averaged 6.19 percent. (More...)
- A Freddie Mac survey out today shows the average fixed rate for a traditional 30-year home loan was back below 5% this week. (More...)
- While longer-term fixed rates have risen, variable rates have declined from a recent high of one per cent over prime, to prime rate, which today sits at 2.25 per cent. (More...)
- The Treasury techs are all still bearish (lower prices, higher yields and mortgage rates). (More...)
- The 30-year fixed-rate mortgage averaged 4.98% for the week ended Thursday, down from last week's 5.03% average and 6.2% a year ago. (More...)
- I don't expect a straight line higher as some days will offer better rates than others. (More...)
- Taking the five year savings bond market as an example, according to Moneyfacts seven banks or building societies are offering a rate of 5% or over, with the top rate being 5.35% from Skipton Building Society. (More...)
- Five-year Treasury-indexed hybrid adjustable-rate mortgages averaged 4.35%, down from last week's 4.42% and 6.19% a year earlier. (More...)
- Margin is a fixed amount added to the underlying index to establish the fully indexed rate for an ARM. (More...)
- Bankrate.com'''s survey of major U.S. banks and thrifts put the 30-year FRM 5.35% with a 0.31 point, even from the previous week. (More...)
SOURCESFIND OUT MORE ON THIS SUBJECTA year ago, the 5-year ARM averaged 6.19 percent. The one-year Treasury-indexed ARM averaged 4.47 percent this week with an average 0.5 point, down from last week when it averaged 4.57 percent. At this time last year, the 1-year ARM averaged 5.25 percent. "Mortgage rates fell back this week pulling interest rates on 30-year fixed mortgages under 5 percent," said Frank Nothaft, Freddie Mac vice president and chief economist. "Lower mortgage rates should help homeowners lower their monthly payments and feed the ongoing recovery in the housing market."
[1] The drop in long-term rates has helped boost mortgage demand, as the
Mortgage Bankers Association reported Wednesday, largely driven by a surge in refinancing. According to the
Federal Housing Finance Agency, Freddie Mac and Fannie Mae have financed more than 3.5 million mortgages during the first nine months of 2009.
Freddie Mac estimates that borrowers who refinanced their conventional loan during the third quarter reduced their interest rate by a median of 1.1 percentage points. The 15-year FRM this week averaged 4.40 percent (0.6 point). Last week it was 4.46 percent, and a year ago at this time, 5.88 percent.
[2] On a $200,000 mortgage, that reduces the monthly payment by about $182 to $1,077. Even though the Fed will slow its purchases of mortgage securities to keep help lower rates, rates for home loans should remain low -- in the 5 percent range -- as long as the purchases continue, analysts say. Freddie Mac said half of borrowers who refinanced their conventional loan in the third quarter lowered their annual mortgage interest rate by at least 17 percent or about 1.1 percentage points below the old rate. That interest-rate reduction adds up to about $3 billion in payment savings for these homeowners over the first 12 months of the new loan, Freddie Mac said.
[3] For almost the entire year of 2009 the Federal Reserve Bank has been creating artificially low mortgage rates by purchasing U.S. Treasuries and Mortgage Backed Securities (MBS). The process of doing this has helped to keep mortgage rates near or below the 5% range for much of 2009. This has been great news for those who are trying to lock into a low mortgage interest rate today but what does is mean for the future of mortgage rates? If the Fed continues its quantitative easing and concludes the MBS purchase program by March of 2010 as they have stated then it is hard to argue that mortgage rates are not going to go higher. This is bad news for future home owners but the reality of the beast. The Fed has already finished the U.S. Treasuries purchase program; November is the first month that the Fed will not make these purchases. We have already seen a leg up in treasury yields since this has happened. When the Fed made the announcement at the beginning of October the 10 year treasury rate yield bounced off its 200 day moving average and has moved higher since. It will be interesting to see just how much higher yields go. For those of you who may not know, there is a strong correlation between the 30 year fixed mortgage rate and the 10 year treasury rate yield.
[4] The conventional 5/1 ARM is also up to 3.84%.'' VA home loan mortgage rates are generally.5% to 1% lower than conventional mortgage rates so you can see VA home loan rates are very attractive at this time. The 10 year treasury rate yield has carved out a steady up trend since the beginning of October when the Fed announced that they will no longer purchase U.S. Treasuries.'' Since the bounce of the 200 day moving average the 10 year yield has worked all the way above its 50 day moving average.''
[5] With the beginning of an up trend taking place for the 10 year yield it seems very likely that we are going to see the 30 year fixed mortgage rate move higher as well. Now might be the time to lock in to low rates because they may be gone soon. Bank of America and many other mortgage lenders have spent a great deal of money to advertise their currently low mortgage rates. It will be interesting to see if this heavy marketing pays off in the long run. There is no doubt that Bank of America is all over the place when it comes to home loans but lets see if that correlates to higher earnings on their balance sheet.
[4] Nationalised bank Northern Rock has cut its mortgage rates for the fourth time in just over a month. The group is slashing rates on 13 of its fixed rate and tracker products, reducing them by up to 0.5%, while it is also launching four new deals. It was joined by Britain's biggest building society Nationwide, which is cutting the cost of 19 of its mortgages, reducing fixed rate loans by up to 0.31% and tracker ones by up to 0.2%. The latest round of cuts, which comes after a flurry of lenders reduced their rates during October, is a further sign that competition is returning to the mortgage market. Among the cuts being made by Northern Rock is a 0.1% reduction to its two-year tracker for people borrowing up to 70% of their home's value who pay a ''595 fee.
[6] Nationalised bank Northern Rock launched a deal at 2.59 per cent, putting it at the top of the best-buy tables for two-year variable rate products. It also reduced rates for the fourth time in as many weeks on 13 of its fixed-rate and tracker mortgages by up to 0.5 per cent. Britain's biggest building'society, Nationwide, also cut the cost of 19 of its mortgages, reducing fixed-rate loans by up to 0.31 per cent and tracker deals by up to 0.2 per cent. Abbey later said it had dropped rates on its fixed-rate and tracker mortgages by up to 0.3 per cent as well as introducing two new two-year fixed-rate mortgages alongside a market-leading fee-free three-year fixed-rate deal of 5.99 per cent for existing 'current-account customers ' with only a 10 per cent deposit required. The latest round of cuts, which comes after a host of banks and building societies reduced their rates last month, was hailed as a further sign that competition was returning to the mortgage market.
[7] Now terms have been agreed with the EU it wants to get as close to ''4bn as it can for 2009 lending and its 2010 target is ''9bn. The deal agreed with the EU is that it will not have any mortgage products in the Moneyfacts top 3 for the relevant category but this does not come into force until January next year and its old limit of 2.5% of total gross lending is effectively redundant. It has a window until the end of the year to be as competitive as it needs to be to hit its targets. This is having more impact on competition in the mortgage market than is likely from the forced sale of some Lloyds Banking Group and RBS branches, and at a time when the extra competition is badly needed. Northern Rock'''s 4.99% five-year (to 31/12/14) flexible fixed rate up to 70% LTV looks attractive for borrowers wanting the security of a fixed rate but despite the cost of two-year fixes also falling, short term fixes such as these offer few attractions compared to the significantly cheaper rates available on the best trackers, with lifetime trackers in particular looking attractive.
[8] The new rate of 2.59% puts it at the top of the best buy tables for two-year variable rate deals. Northern Rock also announced it was launching a range of tracker products for people looking to borrow up to 80% of their home's value. The Government-owned group has to operate its mortgage range within the constraints of its self-imposed competitive framework, under which it is limited to writing 2.5% of new mortgage lending. When this happens the group will be restricted from offering rates that appear in the top three slots of Moneyfacts' best buy tables for fixed rate and tracker deals.
[6] 
A Freddie Mac survey out today shows the average fixed rate for a traditional 30-year home loan was back below 5% this week. It was the second industry survey in two days to show the rate below the threshold, which has become a psychological trigger for homeowners refinancing mortgages.
A Mortgage Bankers Assn. report Wednesday said refis had jumped as the 5% barrier was crashed. Freddie Mac'''s survey, conducted Monday through Wednesday, showed borrowers with good credit and a 20% equity stake in their home were getting 30-year loans for $417,000 or less at an average fixed rate of 4.98%.
[9] The average interest rate on traditional 30-year fixed-rate mortgages fell back below 5% this week, Freddie Mac said Thursday. The mortgage giant's statement was based on its survey of lenders, the second such industry survey in two days to show the rate below 5%, which has become a psychological trigger for homeowners refinancing mortgages.
[10] WASHINGTON -- Home-mortgage rates fell this week, with the average rate on 30-year fixed-rate mortgages retreating back below the psychologically significant 5% level, according to Freddie Mac's weekly survey of mortgage rates. Treasury yields, which hit multidecade lows earlier this year, have been bobbing up and down recently after they retraced from a big rebound in the summer.
[11] In the Western region of the country, which includes California, borrowers were buying down the average rate to 4.91% by paying 0.9 in upfront points to lenders, Freddie Mac said. The rate was down a bit from last week, when it averaged 5.03%, and a lot from last year at this time, when the 30-year fixed-rate mortgage averaged 6.20%.
[9] Last year at this time, the. McLean, VA - October 1, 2009 - (RealEstateRama) -- Freddie Mac (NYSE:FRE) today released the results of its Primary Mortgage Market Survey'' (PMMS'') in which the 30-year fixed-rate mortgage (FRM) averaged 4.94 percent with an average 0.7 point for. Last year at this time, the. Last year at this time, the. Ninety-nine percent of prime borrowers who originally had a conforming ARM selected a new conforming fixed-rate mortgage when they refinanced,.
[1] McLean, VA - November 5, 2009 - (RealEstateRama) Freddie Mac (NYSE:FRE) today released the results of its Primary Mortgage Market Survey'' (PMMS'') in which the 30-year fixed-rate mortgage (FRM) averaged 4.98 percent with an average 0.7 point for the week ending November 5, 2009, down from last week when it averaged 5.03 percent. Last year at this time, the 30-year FRM averaged 6.20 percent. The 15-year FRM this week averaged 4.40 percent with an average 0.6 point, down from last week when it averaged 4.46 percent. A year ago at this time, the 15-year FRM averaged 5.88 percent. The five-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) averaged 4.35 percent this week, with an average 0.6 point, down from last week when it averaged 4.42 percent.
[1] For the week ending November 5, Freddie Mae reported that interest rates for 30-year fixed-rate mortgages (FRMs) averaged 4.98 percent (0.7 point), down from last week's average of 5.03 percent. Last year at this time, the 30-year FRM was 6.20 percent.
[2] Interest rates on U.S. 30-year fixed-rate mortgages averaged 4.98 percent for the week ending November 5, down from the previous week's 5.03 percent, according to a survey released on Thursday by home funding company Freddie Mac ( FRE.P ) ( FRE.N ).
[12] Mortgage interest rates dipped this week, pulling 30-year fixed mortgages under 5 percent, based on Freddie Mac's regular weekly survey. According to Frank Nothaft, Freddie Mac's VP, "Lower mortgage rates should help homeowners lower their monthly payments and feed the ongoing recovery in the housing market."
[2] Freddie Mac, which is the second-largest U.S. mortgage finance company, started the survey in 1971. "Lower mortgage rates should help homeowners lower their monthly payments and feed the ongoing recovery in the housing market," Frank Nothaft, Freddie Mac vice president and chief economist, said in a statement. Mortgage rates are linked to both Treasury and mortgage-backed security (MBS) yields.
[12] NEW YORK (Reuters) - U.S. mortgage rates fell below 5 percent for the first time in three weeks, a key level that may boost home loan demand and help the hard-hit housing market recover, a closely watched mortgage survey showed Thursday.
[12] The 15-year fixed-rate mortgage fell to 4.4%. Industry experts view 5% as a key level because when rates drop below this threshold, home loan demand tends to rise as it did last week for the first time in a month.
[13] For instance, the Federal Housing Finance Agency reported that Freddie Mac and Fannie Mae have financed more than 3.5 million refinance loans during the first nine months of 2009. Freddie Mac estimates that borrowers who refinanced their conventional loan during the third quarter reduced their interest rate by a median of 1.1 percentage points, which will save these borrowers an aggregate of $3 billion in mortgage payments over the next 12 months.
[14] Fixed rates on 15-year traditional mortgages averaged 4.40%, Freddie Mac said, down from 4.46% last week and 5.88% a year ago. Borrowers were paying 0.6% in upfront costs for those loans.
[9] In the Western region of the country, which includes California, borrowers were "buying down" the average rate to 4.91% by paying 0.9% in upfront fees. Fixed rates on 15-year traditional mortgages this week averaged 4.4% nationwide, Freddie Mac said, down from 4.46% last week and 5.88% a year ago.
[10] The 30-year fixed rate mortgage fell to 4.98% this week vs. 5.03% the prior week, said Freddie Mac. That is still above April's record-low 4.78%, but well below 6.2% a year ago.
[13] Freddie Mac '''s ( FRE : 1.25 +2.46% ) survey of mortgage rates saw a key long-term fixed rate dip back below 5% this week.
[15] Mortgage rates once again slipped below 5 percent during the week ended November 5 according to data released today by Freddie Mac.
[14] The benchmark 10 year treasury yield, a leading indicator of conforming 30 year fixed mortgage rates, is down slightly today and at 3.54 as of 12:02 PM PST. The yield is up significantly from 3 weeks ago when it was below 3.2 and 30 year fixed mortgage rates neared 4.5 percent.
[16] The average 30 year fixed mortgage rate decreased to 4.98 percent for the week ending November 5, 2009, down from the previous week's average mortgage loan rate of 5.03 percent.
[17] Following is the report. The average 30 year jumbo mortgage rate is at 5.77 percent this week, down from the previous week'''s average loan rate of 5.85 percent. 15 year jumbo mortgage rates were averaging 5.27 percent this week, down from last week'''s average interest rate of 5.30 percent.
[17] Mortgage points averaged 0.6 points. One year Treasury indexed adjustable rate mortgages averaged 4.47 percent this week, down from the prior week's average one year mortgage interest rate of 4.57 percent.
[17] Until then, it looks as if mortgage rates are going to stay at moderate levels.'' The Fed has eased part of the low interest rate plan by stopping their purchases of U.S. Treasury.''
[18] No matter what treasury yields do mortgage rates continue to move sideways to down.'' This is proving that the Federal Reserve Bank is doing a great job of keeping interest rates low.
[18] RECORD low interest rates yesterday sparked a fresh round in the mortgage price war, bringing further cheer to the housing market. Minutes after the Bank of England announced it was keeping the official cost of borrowing at 0.5 per cent for the ninth month in a row, three high street lenders slashed their mortgage rates.
[7] Certainly the caution flags are flying high. Coincident with the expectation of a North American economic recovery, Canadian banks are finding their borrowing costs for longer-term funds increasing. Mortgage rates, as they usually do, have followed suit. In the past several weeks most major lenders have moved their posted 5-year mortgage rate up to 5.84 per cent, a dramatic upswing from just a few months ago. Remember however, these rates are negotiable with most lenders, often very significantly.
[19] The average two year tracker rate is currently 3.76 per cent, moved by just 0.10 per cent since March, when it was 3.86 per cent. '''A few lenders have made cuts to their mortgage rates over the past few years, but there have been too few to announce a formal return to health competition,''' Mr. Cook added. '''It looks like lenders are trying to increase their lending, but we need to see them trying to better each other on rates.'''
[20] For example two year swaps are 0.30% higher at 2.07% and five year swaps are 0.35% up at 3.45%. Despite these significant increases in swap rates both fixed and tracker mortgage rates have fallen over the last month. Prior to the credit crunch increases in wholesale rates on this scale would certainly have resulted in the cost of fixed rate mortgages rising. The two reasons why they have not are that savings rates are now funding a much higher proportion of mortgage lending and competition in the mortgage market has increased considerably.
[8] The relative stability of savings rates has helped to avoid mortgage rates increasing. Couple this with the significant increase in competition over the last month from a resurgent Northern Rock, which has been cutting some rates twice a week. The impact of that competition has been to force other active lenders to cut their margins on new lending or miss their lending targets.
[8] Mr Boulger expects other mortgage lenders to follow suit if Northern Rock continues to offer more competitive rates. Darren Cook, a spokesperson for Moneyfacts.co.uk, said that only a few lenders have made cuts to their mortgage rates, which isn'''t a good sign for healthy competition. '''It looks like lenders are trying to make an effort to increase their prudent appetite to lend, but we need to see more lenders trying to better each other on rates.'''
[21] Freddie Mac collects mortgage rates on Monday through Wednesday of each week from lenders around the country.
[22] Freddie Mac said the average rate for a 30-year fixed-rate mortgage (FRM) was 4.98% with an average 0.7 point, down from an average 5.03% the previous week.
[15] Results from the weekly Primary Mortgage Market survey peg the average rate for the 30-year fixed-rate mortgage (FRM) at 4.98 percent, down from an average of 5.03 percent a week earlier. Fees and points averaged 0.7 both weeks.
[14] The average rate on a 15-year fixed-rate mortgage declined to 4.40 percent from 4.46 percent recorded last week, according to Freddie Mac.
[22] The average rate fell to 4.98 percent from 5.03 percent a week earlier, mortgage company Freddie Mac said Thursday.
[22] Rates on fixed 30-year loans averaged 5.03 percent, Freddie Mac reported last week, down from 6.46 percent last year.
[3] Freddie Mac said the "5/1" ARM, set at a fixed rate for five years and adjustable each following year, was 4.35 percent, compared with 4.42 percent a week earlier.
[12] The Fed rate does not directly affect conforming 30 year fixed mortgage rates but does affect the market and in turn indirectly affect mortgage rates. This morning it was announced third quarter productivity increased over 9 percent well above the anticipated 6.5 percent.
[16] The average for 30 year fixed mortgage rates remain very close to all time lows.''
[18] If you have been thinking about it in the recent past now is the time to take action.'' With 30 year fixed mortgage rates near all time lows there is no reason to let this opportunity pass you by.''
[18] If the 10 year yield moves all the way up to 4% then it is likely that we are going to see conventional mortgage interest rates around 5.5% or higher.'' Many analysts have predicted that we are going to see mortgage rates around this level before the end of the year and if that is the case it would be a wise idea to lock in to a low mortgage rate today rather than waiting.
[5] The Fed shows no inclination to raise interest rates or otherwise deviate from the course, but another large government debt auction on tap for next week will keep mortgage rates from falling.
[23] Eventually the market is going to set interest rates and we will see mortgage rates move up to normal levels but is doesn't look as if that is going to happen anytime before March 2010.''
[18] Commitment Rate is the interest rate a lender would charge to lend mortgage money to a qualified borrower exclusive of the fees and points required by the lender. This commitment rate applies only to conventional financing on conforming mortgages with loan-to-value rates of 80 percent or less.
[1] Par rates are the lowest available interest rates without the requirement by the lender for the borrower to pay additional points and fees also known as a buy down.
[16] While longer-term fixed rates have risen, variable rates have declined from a recent high of one per cent over prime, to prime rate, which today sits at 2.25 per cent. While this is not at the record low one per cent below prime that we saw before the financial market crash of late 2008, it'''s once again low enough that borrowers should seriously consider the variable-rate option. The same 25-year $100,000 mortgage loan at the current variable rate of 2.25 per cent would further reduce monthly payments to $436.
[19] The average rate on a two year
fixed rate mortgage is currently 5.06 per cent, as it was four months ago in July. This has increased from 4.84 per cent in March.
[20] Since March, the number of mortgages that require a minimum of 15 per cent deposit rose by 62 to 231, according to a new study by Moneyfacts.co.uk. In spite of this, the average 2-year fixed rate mortgage stands at 5.06 per cent, unchanged from July.
[21] The group also launched two new two-year fixed rate mortgages, as well as a market leading fee-free three-year fixed rate deal of 5.99% for existing current account customers with only a 10% deposit.
[6] Abbey has updated its range of mortgage products, the pick of which is a fixed rate deal for house purchases only.
[20] On Wednesday the group said it had lent ''1 billion in the three months to September and ''2.3 billion for the year so far. It originally planned to lend ''5 billion this year but will now not hit this target. It hopes to meet its ''9 billion commitment next year. Abbey later said it had cut rates on its fixed rate and tracker mortgages by up to 0.3% for people borrowing 70% and 75% of the value of their home.
[6] Rates on 30-year mortgages traditionally track yields on long-term government debt. That, plus a federal tax credit of up to $8,000 for first-time homebuyers, has helped boost the ailing housing market. The number of signed contracts to buy previously occupied homes rose for the eighth month in a row in September, while residential construction spending jumped by 3.9 percent, the largest gain in more than six years, data this week showed.
[22] Today's mortgage rates are helping the housing market recover from the decline in home prices over the past couple of years.
[17] Five year U.S. Treasury indexed adjustable mortgage rates averaged 4.35 percent for the week ending November 5, 2009.
[17] "Too Big To Fail" banks are filing for bankruptcy versus helping small-business owners obtain the gap financing that is essential in keeping people working. With foreclosures and unemployment on the rise, I anticipate that the Fed will do everything in its power to keep mortgage rates low through the rest of the year in order to encourage consumer optimism during the holiday buying frenzies.
[23] '''We shouldn'''t be under the illusion that there'''s a free lending market out there. There may have been an increase in enquiries, but whether they come through is a different story.''' Mr Hollingworth added that even if mortgage rates did drop to reflect the bank rate, first-time buyers might not secure the financing they need. That, he said, could cause demand to weaken and property prices to dip again. His remarks come amid rising unemployment and cautious consumer confidence.
[21] Weekly jobless claims fell less than expected. Prices of Residential Mortgage Backed Securities, of which current mortgage rates move opposite, rose slightly but not enough to drive lender's to adjust their rate sheets for the better especially considering the declines the past 2 days.
[16] FreeRateUpdate.com research of wholesale mortgage lender's current mortgage rates shows mortgage rates once again holding steady. There hasn't been much of a change in mortgage rates since they shot up a 1/4 point a little over 3 weeks ago.
[16] If the 50 dma starts to move up with yields then we are in full bull market mode for yields and higher mortgage rates are likely to come. With this in mind now is the time to get out there and refinance your current home mortgage.''
[18] About the Author. Contributing writer Edward J Ferrara III has has over 8 years of experience in both mortgage brokering and banking of loans. Ed's transferred his passion for mortgage to his articles on mortgage rates posted daily on FreeRateUpdate.com. Contact Ed by phone at (714) 694-5914 or
Email him.
[16] The conventional 30 year fixed mortgage rate is up to 4.97% and the 15 year fixed is at 4.32%.''
[5] Will rates rise or remain relatively unchanged? Experts and Bankrate analysts provide their insights. This week (Nov. 5 - Nov. 11) the experts say: There's almost an even split among those who believe rates will go up and those who think they will remain unchanged. This week, half of the panelists believe mortgage rates will remain relatively unchanged (plus or minus 2 basis points) over the next 35 to 45 days. Another 43 percent think rates will rise, and the rest believe rates will fall.
[23] Mortgage discount points averaged 0.5 points. Jumbo mortgage rates currently are lower this week over last.
[17] The mortgage rate is still significantly higher than the record low of 4.78 percent set the week ending April 2.
[12] With many mortgage lenders advertising mortgage rates under 5% there is no reason you cannot lock into a low rate.
[18] Bank of America refinance mortgage rates have been extremely low for most of 2009 but will 2010 be a different story.
[4] At the end of March 2010 the Federal Reserve Bank is going to stop purchasing Mortgage Backed Securities which is sure to make mortgage rates move higher.
[18] Ray Boulger of mortgage broker John Charcol expressed similar sentiments. He said the Bank of England announcement wouldn'''t change mortgage rates.
[21] Bankrate.com surveys experts in the banking and mortgage fields to see if they believe certificate of deposit and mortgage rates will rise, fall or remain relatively unchanged.
[23] Leif Thomsen, CEO of Mortgage Master, in Walpole, Massachusetts, said business is as busy as ever and anticipates mortgage rates staying steady before rising a bit in 2010. "Even this slight rise in rates will take away some of the refinancing action and will put some more pressures on people to make purchases while they can," he said.
[12] Always keep in mind that selecting the best mortgage option for you, and negotiating the lowest-possible interest rate, often have a far greater impact on your lifestyle than does achieving a reduction of a few thousand dollars on the purchase price of your home.
[19] Mortgage interest rates seem to be stabilizing for the short term and will hover right around 5.000 percent (no points) for the near term.
[23] The one-year ARM carried an average contract interest rate of 2.91 percent, down from 3.0 percent.
[14] Banks and building societies are starting to accept higher loan to value arrangements, but interest rates on these loans remain high.
[21] Figures from Moneyfacts.co.uk have revealed that the number of home loan products which require a deposit of 15 per cent has risen from 169 to 231 since the Bank of England base rate of interest was cut to 0.5 per cent in March.
[20] VA home loan rates for November 5th, 2009 were up as the 10 year treasury rate yield continues to move higher.''
[5] WASHINGTON — Rates for 30-year home loans dipped below 5 percent this week after rising for three straight weeks.
[22] Many industry experts view 5 percent as a key psychological level. When rates drop below this threshold, home loan demand tends to rise, while the opposite holds true when rates rise.
[12] We will display the current VA home loan rates as well as a short commentary similar to the above column.
[5] Recent reports from the Bank and the Council of Mortgage Lenders have noted a rise in the number of new home loans.
[7] The new weights use the dollar volume of conventional mortgage originations within the 1-unit Freddie Mac loan limit as reported under Home Mortgage Disclosure Act (HMDA) for 2007.
[1] The borrowers were paying an average of 0.7% of the loan amount in upfront fees and points to the lender, the usual cost reflected in the Freddie Mac survey.
[9] The nationwide fee for loans in Freddie Mac's survey averaged 0.7 points for 30-year loans.
[22] Freddie Mac said the average rate for a 15-year FRM was 4.4% with an average 0.6 point, down from 4.46% the previous week.
[15] Bankrate.com said the 15-year FRM was 4.72%, down from $4.74% in the previous week. Freddie said the five-year Treasury-indexed adjustable-rate mortgage (ARM) was 4.35% this week, with an average 0.6 point, down from last week'''s 4.42%.
[15] Freddie put the one-year Treasury-indexed ARM averaged 4.47% with an average 0.5 point, down from last week when it averaged 4.57%. At this time last year, the 1-year ARM averaged 5.25%. Bankrate.com put the five-year ARM 4.64% this week, even from the previous week.
[15] The five-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) dropped 7 basis points from the previous week's average for an average of 4.35 percent.
[14] A year ago, 15-year mortgages averaged 5.88 percent, the one-year ARM 5.25 percent and the 5/1 ARM 6.19 percent.
[12] Freddie Mac said the 15-year fixed-rate mortgage averaged 4.40 percent in the latest week, down from 4.46 percent the prior week.
[12] Freddie Mac and its larger sibling, Fannie Mae ( FNM.P ) ( FNM.N ), were placed under government conservatorship in early September, 2008. Freddie Mac is a mortgage finance company chartered by Congress that buys mortgages from lenders and packages them into securities to sell to investors or to hold in its own portfolio.
[12] Freddie Mac supports communities across the nation by providing mortgage capital to lenders.
[1] Freddie Mac was established by Congress in 1970 to provide liquidity, stability and affordability to the nation's residential mortgage markets.
[1] The average interest in a Freddie Mac survey of lenders is 4.98%, down from 5.03% a week ago.
[10] Over the years, Freddie Mac has made home possible for one in six homebuyers and more than five million renters.
[1] The Treasury techs are all still bearish (lower prices, higher yields and mortgage rates). One issue of concern is the extent to which the housing market is on life support. It will take a least five and as many as 10 years before the housing market can stand on its own.
[23] One would think that the stopping of U.S. Treasuries would cause treasury yields to move higher but we have yet to see yields move up drastically. Treasury yields have moved up and it looks as if they are carving out a steady up trend.'' The 10 year yield is currently above its 50 day moving average and this average has served as support over the last few days.''
[18] The 30-year fixed-rate mortgage averaged 4.98% for the week ended Thursday, down from last week's 5.03% average and 6.2% a year ago. [11] Rates on five-year, adjustable-rate mortgages averaged 4.35 percent, down from last week's 4.42 percent.
[22] Rates on one-year, adjustable-rate mortgages decreased to 4.47 percent from 4.57 percent.
[22] When the bank rate was last changed in March there were 169 mortgages at 85 per cent loan-to-value, now there are 231.
[7] In conversation with a neighbourhood mortgage broker in Sidney, I learned that a 5-year, 3.85 per cent rate is still available, though perhaps for not much longer.
[19] The recently posted rate of 5.84 per cent results in payments of $630 per month. This is a difference of $112 monthly for 60 months, for a total of $6,720 over five years.
[19] I found that a $100,000 mortgage at 3.85 per cent with a 25-year amortization, costs $518 per month.
[19] The number of mortgage requiring a deposit of just ten per cent has increased in the eight month period, up from 89 to 105. '''It is encouraging to see that lenders are becoming more accommodating with their deposit requirements. This is likely to give more opportunities to first time buyers,''' commented Darren Cook, spokesperson at Moneyfacts.co.uk.
[20] The minimum deposit requirement had soared to as high as 40 per cent in the wake of the subprime mortgage meltdown. In recent months, lenders have lifted some of their restrictions.
[21] Studies have shown that over the past 50 years, the variable-rate option was better for borrowers than fixed-rate choices, about 89 per cent of the time.
[19] Some have chosen to offer more rates at the higher LTVs rather than compete too aggressively for lower LTV business and so borrowers across the LTV spectrum have benefitted. Northern Rock'''s Q3 statement yesterday said that it'''s gross lending in the first nine months of this year was ''2.3bn.
[8] '''Rates will depend on two factors: the level of competition in the lending market - especially with what Northern Rock has been doing - and the degree to which banks can attract savings.'''
[21] Mr Boulger said that rates have been falling slowly, and with Northern Rock'''s aggressive targets, other lenders will be forced to offer better deals.
[21] At the same time the number of people remortgaging has plummeted because the deals available have been very expensive. Many lenders have blamed their high prices on rising'swap' rates ' the rates at which they borrow money ' though experts say home-loan costs are falling now because lenders are once again competing for business.
[7] Chris Sipe, senior mortgage consultant, Mason Dixon Funding, Frederick, Md. With the Fed announcing their commitment to keep the funds rate low for as long as they can, along with inflationary indicators feeling the pressure, rates will remain unchanged. This is a great time to buy with rates low, inventory great, sellers motivated and the tax credit extension granted.
[23] Continued weak economic news is holding rates down for the time being, but any glimmer of hope combined with the phasing out of Fed/Treasury mortgage bond purchases will cause rates to rise quite rapidly.
[23] Schedule some time with your local mortgage adviser and lock into some incredible rates.
[23] Current mortgage rates are also contributing to an increase in mortgage refinance activity.
[17] Some variable-rate mortgages do offer partial protection, by providing the opportunity of locking in to a fixed rate at a future date.
[19] Rates are relatively higher for mortgages with small deposits.''' While providers appear to be more inclined accept smaller, average rates on such products show little movement.
[20] The Federal Reserve has pumped $1.25 trillion into mortgage-backed securities in an effort to lower rates on mortgages and loosen credit.
[22] Variable-rate mortgages, having returned to relatively attractive rates, at least deserve serious consideration by borrowers.
[19] Fortunately the picture for mortgage borrowers looks a little brighter, despite LIBOR rates having edged up over the last month, with three month LIBOR up from 0.55% to 0.60%, and swap rates having risen quite sharply.
[8] Lenders are cautious and standards remain tight, so the best rates are available only to borrowers with solid credit and a 20 percent down payment.
[22] Rates had hovered below 5 percent for nearly a month until inching upward two weeks ago. They hit a record low of 4.78 percent in the spring, but are still attractive for people looking to buy a home or refinance.
[22] Make sure to check out Subprime Blogger on a daily basis for your VA home loan rates.
[5] The Mortgage Bankers Association said U.S. mortgage applications rose for the first time in four weeks, reflecting a jump in demand for home refinancing loans.
[12] Loan to Value Ratio (LTV) is the ratio of the loan amount of a mortgage loan to the lower of the appraisal value or purchase price of the property securing the loan.
[1] I don't expect a straight line higher as some days will offer better rates than others. This week, the big news on factors impacting overall interest rates will be the employment report on Friday.
[23] Rates often fluctuate significantly, even within a given day, frequently in line with long-term Treasury bonds.
[22] Rates have been fairly stable the last few weeks after rising a bit in the beginning of October. This is despite the Fed ending its purchase of Treasuries in October and winding down its purchases of mortgage-backed securities. This tells me that the bond markets believe that any recovery will be weak and uneven. That is a belief that I agree with.
[23] Both decreased mortgage-backed securities, or MBS, purchases from the Fed and potential downgrades on existing MBS pools could play havoc with rates.
[23] Taking the five year savings bond market as an example, according to Moneyfacts seven banks or building societies are offering a rate of 5% or over, with the top rate being 5.35% from Skipton Building Society. Although competition in this market has increased to the extent that the number of banks or building societies offering over 5% has grown, the top rate available has remained in the very narrow range of 5.3-5.4% for several months.
[8] "Further, pending sales for existing homes rose for the eighth straight month in September to the strongest pace since December 2006, while spending on private residential construction jumped 3.9 percent and represented the largest gain since July 2003. In the third quarter of this year, residential fixed investment added almost a full percentage point to economic growth."
[1] Government guaranteed FHA and VA 30-year fixed mortgages were eased slightly from 5.54 percent to 5.52 percent.
[14] The Mortgage Bankers Associations weekly Refinance Index, which measures
mortgage refinance applications''increased''14.5 percent from the previous week.
[17] '''If we look at the bigger picture, lenders have a limited appetite for lending in what seems like an uncertain market,''' said David Hollingworth of London and Country Mortgage Brokers.
[21] Northern Rock has reported that it is making good progress and is on course to reach its 2009 mortgage lending target.
[20] Five-year Treasury-indexed hybrid adjustable-rate mortgages averaged 4.35%, down from last week's 4.42% and 6.19% a year earlier. [11] If you are looking for either a new mortgage or to renew an existing one, do not sign on the dotted line without first checking out other lenders, especially mortgage brokers.
[19] Margin is a fixed amount added to the underlying index to establish the fully indexed rate for an ARM. [1] We have seen the average for the 30 year fixed around or below 5% since the middle of September.''
[18] Bankrate.com'''s survey of major U.S. banks and thrifts put the 30-year FRM 5.35% with a 0.31 point, even from the previous week. [15] SOURCES1.
30-Year Fixed Rate Falls Below 5 Percent | RealEstateRama2.
Mortgage Rates Fall Below Five Percent: Freddie Mac3.
Homeowners saving with lower mortgages :: CHICAGO SUN-TIMES :: Personal Finance4.
Bank of America Refinance Mortgage Rates Interest Rates Higher in 2010? : Subprime Blogger5.
VA Home Loan Mortgage Rates Mortgage Interest Rates Higher Today : Subprime Blogger6.
The Press Association: Northern Rock cuts loan rates again7.
Daily Express | UK News :: Boost for market housing market as lenders cut mortgage rates8.
QE extended by ''25bn but it is savers who bring relief to mortgage borrowers | Opinion | Mortgage Strategy9.
Freddie Mac confirms: 30-year rate below 5% again | L.A. Land | Los Angeles Times10.
30-year fixed-rate mortgages dip below 5% again -- latimes.com11.
Mortgage Rate Falls Below 5% - WSJ.com12.
Mortgage rates drop below 5 percent: Freddie Mac | Reuters13.
Investors.com - U.S. mortgage rates dip under 5%14.
Fannie and Freddie: Mortgage Rates Dip Below 5 Percent Again15.
Freddie's Weekly Mortgage Rate Dips Below 5% : HousingWire || financial news for the mortgage market16.
Current Mortgage Rates: Another Flat Day for Mortgage Rates. Current 30-Yr Fixed-Rate 4.875 |17.
30 Year Mortgage Rates Back Under 5.00% @ Mortgage Rates, Mortgage Calculator, Current Mortgage Rates, Refinance Rates, HELOC/Home Equity, Mortgage Reviews, Mortgage Rate Tables, 30 year, 15 year, 5/1 ARM,18.
30 Year Fixed Mortgage Rates Remain Near All Time Lows : Subprime Blogger19.
BCLocalNews.com - Mortgage rates on the rise?20.
Size of required mortgage deposits begin to lessen21.
FT.com / Property & Mortgages - Mortgage lenders ease deposit restrictions22.
The Associated Press: Rates on 30-year loans fall below 5 percent23.
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