Freddie Mac, Bankrate: Mortgage rates fall

By Palm Beach Business.com

DELRAY BEACH — Mortgage rates fell back to record lows over the past week even as recent reports show signs of an economy gathering some strength.

Freddie Mac’s Primary Mortgage Market Survey found the 30-year fixed-rate mortgage falling to 3.91 percent with 0.8 point, tying a record set a few weeks ago. Last week the 30-year had an average rate of 3.95, according to the Freddie Mac survey.

It was also the fifth straight week the 30-year averaged below 4 percent.

Bankrate’s national survey fell to an average of 4.18 percent with 0.34 point, down from 4.21 percent a week earlier. The Bankrate survey tends to be slightly higher than Freddie Mac’s.

"Fixed mortgage rates started the year a little lower this week just as recent data reports indicate the housing market and manufacturing industry are showing signs of improvement,” Freddie Mac Chief Economist Frank Nothaft said. “ Pending existing home sales in November jumped 7.3 percent, nearly five times greater than the market consensus forecast, to its strongest pace since April 2010. In addition, construction spending rose 1.2 percent in November, supported by the residential sector which exhibited its fourth consecutive monthly increase. Similarly, manufacturing expanded in December at the fastest pace in six months."

Bankrate noted that mortgage rates have moved within an unusually narrow range over the past several months. This type of calm on the mortgage rate front hasn't been seen in nearly two years. The European debt crisis, which remains fluid, and the Labor Department’s December jobs report due out Friday morning could change that.

Meanwhile the 15-year fixed-rate mortgage also continued to drop in both surveys: Freddie Mac found the rate dropping to 3.23 percent with 0.8 point from 3.24 percent a week ago; Bankrate survey pegged the 15-year at 3.40 percent with 0.36 point, down from 3.44 percent a week ago.

Surveyed banks: PNC, Bankatlantic, Bank of America, Chase, Citibank, TD Bank, Wachovia, Suntrust.

 

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