Fannie and Freddie: Mortgage Rates Dip Below 5 Percent Again

Mortgage rates once again slipped below 5 percent during the week endedrnNovember 5 according to data released today by Freddie Mac.

Results from the weekly Primary Mortgage Market survey peg the averagernrate for the 30-year fixed-rate mortgage (FRM) at 4.98 percent, down from anrnaverage of 5.03 percent a week earlier. rnFees and points averaged 0.7 both weeks. 

The 15-year FRM averaged 4.40 percent with 0.6 point compared to 4.46rnpercent also with 0.6 point last week.

The five-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) droppedrn7 basis points from the previous week's average for an average of 4.35rnpercent.  Fees and points were unchangedrnat 0.6 point.

The one-year Treasury-indexed ARM was at 4.47 percent with 0.5rnpoint.  Last week the average was 4.57rnpercent with 0.5 point.

“Mortgage rates fell back this week pulling interest rates onrn30-year fixed mortgages under 5 percent,” said Frank Nothaft, Freddie Macrnvice president and chief economist. “Lower mortgage rates should helprnhomeowners lower their monthly payments and feed the ongoing recovery in thernhousing market.” For instance, the Federal Housing Finance Agency reportedrnthat Freddie Mac and Fannie Mae have financed more than 3.5 million refinancernloans during the first nine months of 2009. Freddie Mac estimates thatrnborrowers who refinanced their conventional loan during the third quarterrnreduced their interest rate by a median of 1.1 percentage points, which willrnsave these borrowers an aggregate of $3 billion in mortgage payments over thernnext 12 months.

“Further, pending sales for existing homes rose for the eighthrnstraight month in September to the strongest pace since December 2006, whilernspending on private residential construction jumped 3.9 percent and representedrnthe largest gain since July 2003. In the third quarter of this year,rnresidential fixed investment added almost a full percentage point to economicrngrowth.”

Fannie Mae also announced lower weekly yields for the week endedrnOctober 30.

The conventional 30-year FRM averaged 4.71 percent compared to 4.76rnpercent the previous week.  The 15-yearrnFRM was at 4.07, down from 4.13 a week earlier. rnThe one-year ARM carried an average contract interest rate of 2.91rnpercent, down from 3.0 percent.

Governmentrnguaranteed FHA and VA 30-year fixed mortgages were eased slightly from 5.54rnpercent to 5.52 percent.

AllrnFannie Mae yields are reported net of servicing fees.

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