Freddie Mac, Bankrate: Mortgage rates still near record lows

By Palm Beach Business.com

DELRAY BEACH — Mortgage rates continue to remain near record lows, as they have most of the summer, according to separate surveys done by Freddie Mac and Bankrate.com.

Freddie Mac found the 30-year fixed rate mortgage moving slightly higher, to 4.37 percent with 0.7 point, from last week’s 4.35 percent. A year ago, the 30-year was at 5.04 percent.
Meanwhile, Bankrate put the 30-year at 4.54 percent with 0.37 point, down from 4.58 percent a week ago.

Freddie Mac’s survey found the 15-year mortgage slipping to 3.82 percent with 0.6 point, a record, down from 3.83 percent a week ago. Bankrate put the 15-year at 4.00 percent, down from last week 4.06 percent.

"Interest rates on 30-year fixed mortgages have remained below 5 percent for the last 19 weeks giving people ample opportunity to refinance their existing mortgage debt,” said Frank Nothaft, chief economist for Freddie Mac. “As a result, homeowners reduced their financial obligations relative to disposable personal income during the second quarter of 2010 to the lowest share in almost eight years, according to the Federal Reserve . Currently, four out of five mortgage applications are for refinancing existing mortgage debt, based on figures by the Mortgage Bankers Association ."

Bankrate, meanwhile, noted the Federal Reserve will be meeting soon to review interest rates, and that could add some volatility to the market.

Although unlikely at the upcoming meeting, any additional bond purchases by the Fed would be designed to drive long-term interest rates – and mortgage rates – lower. Recent economic reports have been a bit better than expected and remove the urgency for the Fed to take immediate action. Nonetheless, any hint of what the Fed is thinking about either the economy or the need for additional measures, could spark the next big move in mortgage rates.

Bankrate’s panel of mortgage experts sees rates staying right where they are in the short term; 57 percent say rates aren’t headed anywhere, while 43 percent see rates rising. No one sees rates falling.

 

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SEPTEMBER 16, 2010 click to go home
 
         
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