Mortgage Informer

U.S. mortgage rates declined, lowering borrowing costs as the housing market’s recovery shows signs of slowing.

The rate for 30-year fixed U.S. home loans fell to 4.97 percent for the week ended today from 5.05 percent, mortgage finance company Freddie Mac said in a statement. The average 15- year rate was 4.33 percent, according to the McLean, Virginia- based company.

“Consumers are still a little bit cautious,” said George Mokrzan, senior economist at Huntington National Bank in Columbus, Ohio. “The low rates, they’re an incentive.”

Mortgage rates remain relatively low — for now — but the gap between 15-year and 30-year fixed mortgage rates are widening — and that’s good news if you’re in the market for a 15-year mortgage. Here’s how low you can go when it comes to 15-year fixed-mortgage rates.

After several weeks below 5 percent, the average interest rate on a 30-year, fixed-rate mortgage (FRM) reversed course and rose to an average 5.05 percent, up from last week’s 4.93 percent, according to Freddie Mac’s weekly Primary Mortgage Market Survey (PMMS).

For the week ending Feb. 25, the rate includes an average 0.7 point. Last year, at this time, the 30-year FRMaverage was 5.07 percent.

The 30-year FRM’s record low average, 4.71 percent, was posted Dec. 3, 2009 as the lowest conforming loan rate since Freddie Mac began its weekly survey in 1971.

The default rate for commercial property mortgages held by U.S. banks more than doubled in the fourth quarter and may reach a peak of 5.4 percent at the end of next year, according to Real Capital Analytics Inc.

The default rate for loans on office, retail, hotel and industrial properties surged to 3.8 percent from 1.6 percent a year earlier, the New York-based real estate research firm said yesterday in a report. The default rate for loans on apartment buildings climbed to 4.4 percent from 1.8 percent.

Bank of America refinance mortgage rates continue to hold steady below 5%. Bank of America home loans are currently at 4.95% on the 30 year fixed mortgage rate. The week of February 22nd, 2010 is likely to be very interesting as the 10 year treasury rate yield continues its up trend and we could see mortgage rates push higher.

Bank of America and all mortgage lenders have marketed the current low interest rate environment very well. President Obama and his staff have worked very hard to keep interest rates low so both the American public can benefit and the banks can benefit by gaining new customers and offering low mortgage interest rates.

Mortgage rates fell, with shorter-term loans posting the biggest declines and the average rate on 30-year fixed-rate mortgages retreating further below 5%, according to Freddie Mac’s weekly survey.

The 30-year fixed-rate mortgage averaged 4.93% for the week ended Thursday, down from last week’s 4.97% average and 5.04% a year ago. It hit its lowest rate on record this month, when it fell to 4.71%.

The volume of mortgage applications filed last week dropped a seasonally adjusted 2.1%, compared with the previous week, the Mortgage Bankers Association reported on Wednesday.

Mortgage interest rates were flat during the week ended Feb. 12, compared with the week before, according to the MBA’s weekly survey. The survey covers about half of all U.S. retail residential mortgage applications.

Applications filed to refinance an existing mortgage fell an unadjusted 1.2% from the previous week. Home-purchase mortgage applications fell a seasonally adjusted 4.0%.

The four-week moving average for all mortgages was up 1.1%.

With mortgage rates hovering around the 5% mark, it is still advantageous to purchase a home. These rates will begin to rise as the Federal Reserve begins to withdraw excess liquidity from the economy, which they will have to do in the near future. This will lead to increased mortgage rates. The only situation that homeowners should be aware of is that the home they are interested in, is not located in an area where home prices still have more downside.

5% Still An Excellent Rate

Prospective homebuyers should know that since the beginning of the year, two important events have occurred with mortgage offerings.  First, the rates on some types of mortgages have declined.  Second, a number of lenders have introduced new mortgage plans as a way of competing for your business.

Recent figures released by the Bank of England indicate that the interest rates on tracker mortgages and fixed-rate mortgages have decreased in recent weeks.  At the same time, many of the newer mortgage offerings require a smaller deposit, something that may be very attractive to people who want to move forward with buying a new home.

Mortgage rates in the U.S. rose for the first time in five weeks, threatening to slow the housing market’s recovery as government incentives near expiration.

The rate for 30-year fixed U.S. home loans rose to 5.01 percent for the week ended today from 4.98 percent, mortgage finance company Freddie Mac said in a statement. The average 15- year rate was 4.40 percent, according to the McLean, Virginia- based company.

Rising rates make it more expensive for consumers to buy homes. Sales of existing homes climbed 5 percent in 2009 after falling for three years. Demand rose as buyers took advantage of an $8,000 government tax incentive and low mortgage rates.