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Freddie Mac: Mortgage rates in 2012 cheapest in 65 years

By Palm Beach Business.com

DELRAY BEACH — Mortgage rates fell back near record lows after rising fairly sharply a week ago thanks largely to the prospect of the country going over the so-called fiscal cliff, according to surveys released Thursday by Freddie Mac and Bankrate.

Freddie Mac’s Primary Mortgage Market Survey found the average 30-year fixed-rate mortgage dropping to 3.35 percent with 0.7 points from 3.37 percent a week ago. Bankrate’s national mortgage survey spotted the 30-year at an average of 3.59 percent with 0.34 point.

The 15-year fixed-rate held steady at 2.65 percent with 0.7 point, according to Freddie. A year ago, the 15-year averaged 3.24 percent. Bankrate has the 15-year at 2.87 percent with 0.24 point, down from an average of 2.89 percent a week ago.

The inability of Congress to resolve the budget impasse last week was a primary reason why stocks fell last week. And usually when stocks fall, investors generally head toward the safety of government securities, which, in turn, pushes mortgage rates down.

In any case, the low rates have been a boon for those either in the market for a home or who are looking to refinance.

"The 30-year fixed-rate mortgage averaged 3.66 percent for 2012, the lowest annual average in at least 65 years,” Freddie Mac Chief Economist Frank Nothaft said. “Rates on 30-year fixed mortgages were nearly 0.6 percentage points below that of the beginning of the year, which translates into an interest payment savings of nearly $98,600 over the life of a $200,000 loan. Moreover, opting for a 15-year fixed mortgage at today's rates, a homeowner could save an additional $138,400 in interest payments."