Mortgage rates dropped again this week, as the conforming 30-year fixed mortgage rate falling to 4.77% with 0.4 discount and origination points, according to Bankrate.com.
The average 15-year fixed mortgage pulled back to 3.95% and the larger jumbo 30-year fixed rate retreated to 5.22%. Adjustable rate mortgages established new lows, with the average 5-year ARM sinking to 3.48% and the 7-year ARM settling at 3.73%.
Loss of momentum in the economic recovery, and worries that the economy could slow further once the Fed stops pumping money into the markets via bond purchases, have investors nervous. Nervous investors typically move their money into the safe-haven Treasury securities to which mortgage rates are closely related. This has helped keep fixed mortgage rates at historic lows and within striking distance of the all-time lows that were established in November 2010.
The last time mortgage rates were above 6% was Nov. 2008. At the time, the average 30-year fixed rate was 6.33%, meaning a $200,000 loan would have carried a monthly payment of $1,241.86. With the average rate now 4.77%, the monthly payment for the same size loan would be $1,045.71, a difference of $196 per month for anyone refinancing now.
Source: Bankrate, Inc.
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