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GSEs: Long Term Rates Again Below 5 Percent

by devteam March 8th, 2010 | Share

Mortgagernrates reversed course yet again during the week ended March 4 with the 30-yearrnfixed-rate mortgage (FRM) once more falling below 5 percent. According tornFreddie Mac's Primary Mortgage Market Survey, the 30-year FRM averaged 4.97rnpercent with an average of 0.7 point compared to an average rate of 5.05 percentrnwith 0.7 point the previous week.

Thern15-year FRM averaged 4.33 percent, down from 4.40 percent the week before.  Fees and points remain unchanged at 0.7rnpoint.

Thern5-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) had an averagernrate of 4.11 percent, down from 4.16 percent during the week ended Februaryrn25.  Fees and points also declined fromrn0.6 point to 0.5 point.

Thernone-year Treasury-indexed ARM was the lone exception to the downwardrntrend.  The average rate for that productrnwas 4.17 percent with 0.6 point.  A weekrnearlier the rate was 4.15 percent also with 0.6 point.

“30-year fixed mortgages fell below 5 percent to match levels seen twornweeks ago and are helping to maintain affordable home-purchasernconditions,” said Frank Nothaft, Freddie Mac vice president and chiefrneconomist. “In fact, monthly principal and interest mortgage payments forrna typical family buying a median-priced home of $163,800 were just $709 inrnJanuary, the lowest amount since February 1998, according to the NationalrnAssociation of Realtors®.  For first-timernhomebuyers, the fourth quarter of 2009 was the third most affordable quarterrnsince 1981 behind the first and second quarter of 2009.

“The federal tax credit for homebuyers, which expires on April 30th, mayrnmake housing even more affordable for some families already in the middle ofrnthe home buying process. In fact, the Federal Reserve's March 3rd regionalrneconomic review noted that several districts attributed stronger home sales tornthe homebuyer tax credit.”

FanniernMae reported that its weekly yields had experienced a similar decline. Thernconventional 30-year FRM had an average yield of 4.70 percent during the weekrnended February 26 compared to 4.82 percent a week earlier.  The 15-year FRM dropped to 3.98 percent fromrn4.11 percent and FHA/VA guaranteed loans averaged 5.40 percent compared to 5.49rnpercent the previous week.  The one-yearrnARM slipped slightly to 2.44 percent from 2.46 percent.

AllrnFannie Mae yields are quoted on a net basis. rnServicing fees are not included.

All Content Copyright © 2003 – 2009 Brown House Media, Inc. All Rights Reserved.nReproduction in any form without permission of MortgageNewsDaily.com is prohibited.

About the Author

devteam

Steven A Feinberg (@CPAsteve) of Appletree Business Services LLC, is a PASBA member accountant located in Londonderry, New Hampshire.

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