NEW YORK, NY - Mortgage rates pulled back slightly this week, with the average rate on the benchmark conforming 30-year fixed mortgage rate receding to 4.96 percent, according to Bankrate.com's weekly national survey. The average 30-year fixed mortgage has an average of 0.46 discount and origination points. The average 15-year fixed mortgage retreated to 4.29 percent, while the larger jumbo 30-year fixed rate bucked the trend, inching higher to 5.59 percent. Adjustable rate mortgages were broadly lower, with the average 5-year ARM falling to 3.92 percent and the average 7-year ARM slipping to 4.35 percent.
After showing an almost meteoric rise in the preceding six weeks, mortgage rates pulled back slightly this week, falling below the 5 percent threshold. Investors – including the biggest investor of them all, the Federal Reserve – swooped in and picked up government bonds in the wake of the recent selloff, driving bond yields and mortgage rates lower. Mortgage rates are closely related to yields on long-term government bonds. Mortgage rates will likely hopscotch back and forth over the 5 percent mark in early 2011, but continued economic improvement will see mortgage rates trending higher as the year unfolds.
The last time mortgage rates were above 6 percent was Nov. 2008. At that time, the average rate was 6.33 percent, meaning a $200,000 loan would have carried a monthly payment of $1,241.86. With the average rate now 4.96 percent, the monthly payment for the same size loan would be $1,068.76, a savings of $173 per month for a homeowner refinancing now.
Bankrate's national weekly mortgage survey is conducted each Wednesday from data provided by the top 10 banks and thrifts in the top 10 markets.
For a full analysis of this week's move in mortgage rates, go to: www.bankrate.com/mortgagerates.
The survey is complemented by Bankrate's weekly Rate Trend Index, in which a panel of mortgage experts predicts which way the rates are headed over the next seven days. Half of the panelists predict mortgage rates will be more or less unchanged over the coming week. The others are split, with 30 percent expecting an increase and the remaining 20 percent predicting a decline in mortgage rates over the next seven days.
For the full mortgage Rate Trend Index, go to: www.bankrate.com/RTI.
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