Fixed mortgage rates break records for second straight week
15-year fixed rates fall below 5-year ARM rates
Interest rates for fixed-rate mortgages broke record lows for the second straight week, Freddie Mac said in its weekly mortgage report.
According to Freddie Mac’s Primary Mortgage Market Survey for the week ending October 4, 2012, both 30-year and 15-year fixed mortgage rates fell to new all-time record lows.
In addition, the average rate for 15-year fixed mortgages dropped below that of 5-year adjustable-rate mortgages (ARMs) for the first time since October 2009.
Fixed mortgage rates continue sliding
Average rates for 30-year fixed-rate mortgages dropped to 3.36 percent in this latest data. The previous week, 30-year fixed mortgages averaged 3.40 percent, while the average one year ago stood at 3.94 percent.
Shorter-term 15-year fixed mortgages averaged 2.69 percent, a drop from 2.73 percent the previous week and significantly below the average of 3.26 percent observed at this time a year ago.
ARMs show mixed results
Average rates for 5-year ARMs rose slightly to 2.72 percent from last week’s 2.71 percent average, while 1-year ARMs dropped week-over-week from an average of 2.60 percent to 2.57 percent.
One year ago at this time, 5-year ARMs and 1-year ARMs averaged 2.95 percent.
“Fixed mortgage rates fell again this week to all-time record lows due to the mortgage securities purchases by the Federal Reserve and indicators of a weakening economy,” Frank Nothaft, vice president and chief economist at Freddie Mac, said in a statement.
Nothaft highlighted areas of concern in the economy based on recent data.
“The final estimate of growth in Gross Domestic Product was revised down to 1.3 percent in the second quarter, representing the slowest growth in a year,” he said. “In addition, personal incomes rose only 0.1 percent in August, while July’s increase was revised downward. And finally, pending home sales in August fell 2.6 percent, well below the market consensus forecast of a slight increase.”