Fixed Mortgage Rates Hover Near Lows for 6th Week

Fixed mortgage rates hover near lows for 6th weekWASHINGTON (AP) - The average rate on the 30-year fixed mortgage hovered above its record low for a sixth straight week. But the super-low rates aren't providing a lift to the struggling housing market.

Freddie Mac said Thursday the rate on the 30-year home loan ticked down to 3.99 percent from 4 percent the previous week. It dropped to a record low of 3.94 nine weeks ago, according to the National Bureau of Economic Research.

The average rate on the 15-year fixed mortgage was edged down to 3.27 percent from 3.30 percent. Nine weeks ago, it too hit a record low of 3.26 percent.

Rates have been below 5 percent for all but two weeks this year. Yet this year could be the worst for home sales in 14 years.

Mortgage rates tend to follow the yield on 10-year Treasury note. The yield rose this week after investors, encouraged by central banks' joint effort to ease lending standards, shifted their money into stocks. Treasury yields rise when buying activity decreases.

Low mortgage rates haven't translated into more home sales. Sales of previously occupied homes are just slightly ahead of last year's dismal sales figures - the worst in 13 years. New-home sales appear headed to their worst year on records dating back half a century.

Mortgage applications rose nearly 13 percent last week but that's up from extremely low levels, according to the Mortgage Bankers Association.

High unemployment and scant wage gains have made it harder for many people to qualify for loans. Many Americans don't want to sink money into a home that could lose value over the next three to four years.

The low rates have caused a modest boom in refinancing last week. But since the average rate on the 30-year fixed loan has been below 5 percent for all but two weeks in the past year, most homeowners who can afford to refinance already have.

Some lenders say they are seeing an increase in applications through the Obama administration's refinancing program, which was broadened in October to allow up to 1 million more homeowners lower their monthly mortgage payments. But the Mortgage Bankers Association said such government-assisted loans account for only a small portion of refinancing applications.

The average rates don't include extra fees, known as points, which most borrowers must pay to get the lowest rates. One point equals 1 percent of the loan amount.

The average fee for the 30-year loan was unchanged at 0.7 and the fee on the 15-year fixed mortgage was unchanged at 0.8.

The average rate on the five-year adjustable loan rose to 2.93 percent from 2.90 percent. The average rate on the one-year adjustable loan also increased slightly to 2.80 percent from 2.78 percent.

The average fee on the five-year loan fell to 0.5 from 0.6 and the fee on the one-year adjustable loan was unchanged at 0.6.

To calculate average mortgage rates, Freddie Mac surveys lenders across the country Monday through Wednesday of each week.

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Collosal Cuts Biggest Corporate Layoffs of All Time - 24/7 Wall Street

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Now doesn't that just want you to go out and buy a house? OMG come on do you really believe that the nation's people are that stupid.

December 09 2011 at 11:11 AM Report abuse rate up rate down Reply

Let's talk consumer confidence shall we, first the jobs problem. Yesterday, it was reported that the banks were going to lay off Americans (their is a rumour that the positions are moving overseas to save money), then big Pharma Astra Zenca is laying off. Right before the end of the year (or right before Christmas how Ebeneezer can corporations get). So, if you are considering a re-fi or even a starter home, new home, would you do it if your company is struggling economically and you may be slated for job elimination. Second, let's face it alot of US out there do not trust Banks. We don't trust them one bit. So why are we going to give our hard earned money to a bunch of shylocks who are going to sell our note to who knows who and it goes who knows where. ??? And your right someoneole who is going to buy the debt. If you thought that the US people were consumer confidence shy go to Europe. And why is Timmy Geithner peddling his propoganda in Europe asking them to fix their problems. Timmy get home, your arse, you've created enough problems here -- remember the proverb that said, it's is a fool that goes to a neighbor's home when their is trouble.

December 09 2011 at 10:38 AM Report abuse rate up rate down Reply