Largely in response to the Fed’s promise of injecting more money into the economy by buying over $1 trillion worth of Fannie and Freddie mortgage backed securities (MBS), the 30-year fixed rate mortgage fell to below 5% today:
By the close of business on March 19, the 30-year conforming FRM fell to 4.94%, according to Keith T. Gumbinger, a VP at HSHAssociates.com. That’s a fall of nearly a quarter percent since Wednesday.
According to Monday’s Market Trends Newsletter: “Conforming 30-year FRMs — which, by some measures, dipped below the 5% mark last week — rose to an average 5.34%, while 30-year FRM jumbos tracked just 11 basis points higher.”
Despite 30-year conforming rates easing upwards, and reports that mortgage applications are plunging, refinancing is still a viable option for many borrowers.
By the end of last week, market analysts got their first indications of activity for the new year. From the latest issue of HSH’s Market Trends newsletter: “Mortgage rates were basically unchanged [last] week, which included the first days of 2009. Thinly traded markets, vacations and holidays being what they are, a lack of any real direction is pretty typical.
Overall, the average 30-year fixed rate mortgage nudged a lone basis point higher. HSH’s Fixed-Rate Mortgage Indicator FRMI rose to 5.89%. The overall average for the 5/1 Hybrid ARM slipped back by fourteen basis points, landing at 5.80% for the week, the lowest such average since February 2008.
