Back in June, in a post about adjustable-rate home loans, Bucks mused about how nice it would be to have a mortgage interest rate that began with a “3.” The way things are going, that time may not be far off for fixed-rates loans, as well. Mortgage rates reached record lows this week, according to the weekly market survey from Freddie Mac. The average rate on a 30-year fixed-rate loan fell to 4.15 percent, with borrowers paying an average point of 0.7 percent. That rate is down from 4.32 percent last week.
It is “the lowest in over 50 years,” Frank Nothaft, vice president and chief economist at Freddie Mac, said in a news release. The survey’s previous low was 4.17 percent in November 2010.
Average fixed rates for 15-year mortgages were already in three-point territory and this week they dropped even lower, to 3.36 percent, with an average of 0.6 points. Rates on adjustable-rate loans fell too.
The caveat here, of course, is that in order to get those low rates, borrowers are paying points — essentially, interest paid up front, in a lump sum. Without the points, the average interest rates would be higher. At zero points, the average rate for the 30-year fixed loan would be about 4.31 percent, and 3.51 percent for the 15-year loan, a Freddie Mac spokesman said. (Generally, the thinking is that it makes sense to pay points only if you plan to stay in the house for several years or more, so that you have time to recoup the cost in the form of the lower rate).
Are the low rates encouraging you to consider refinancing your home loan?
More good news!
