Sunday, April 10, 2011

Mortgage rates barely budge in latest week, stay below 5%

NEW YORK — Fixed mortgage were essentially unchanged this week, as the average rate on the 30-year fixed loan stayed below 5%.

Freddie Mac said Thursday that the average rate on 30-year fixed mortgages rose to 4.87% from 4.86% the previous week. It hit a 40-year low of 4.17% in November.

The average rate on 15-year fixed mortgages increased to 4.10% from 4.09%. It reached 3.57% in November, lowest rate on records dating back to 1991.

Mortgage rates tend to track the yield on 10-year Treasury notes.

STORY: Housing crash slows in 6 citiies

Low rates have done little to boost home sales. KB Home was the latest homebuilder to report this week a sharp decline in home orders for the December-February quarter. The Los Angeles company said Tuesday that its new home orders dropped 32% from a year earlier, while the number of homes it delivered tumbled 28%.

Last week, Lennar posted similar results. Its new orders fell 12% in the same period and home deliveries slipped 3%.

Many would-be buyers are reluctant to move because of strict credit requirements, unemployment fears and expectations that home prices will fall further, largely because of the record number of foreclosured homes on the market.

To calculate average mortgage rates, Freddie Mac collects rates from lenders across the country Monday through Wednesday each week. Rates often fluctuate significantly, even within a day.

The average rate on a five-year adjustable-rate mortgage rose to 3.72% from 3.70%. The five-year hit 3.25% last month, lowest rate on records dating back to January 2005.

The average rate on a one-year adjustable-rate loan fell to 3.22% from 3.26%. Three weeks ago, the rate hit 3.17%, lowest level on records dating back to 1984.

The rates do not include add-on fees, known as points. One point is equal to 1% of the loan amount. The average fee for the 30-year fixed loan, 15-year fixed loan and the 1-year ARM in Freddie Mac’s survey was 0.7 point. The average fee for the five-year ARM was 0.6 point.

No comments:

Post a Comment