Interest rates for the benchmark 30-year fixed-rate mortgage tumbled to a national average 5.17 percent this week, the lowest level since Freddie Mac began its weekly rate survey in 1971. The decline was supported by the Federal Reserve announcement on Dec. 16, when it cut the federal funds target rate to a record low, a range of zero to 0.25 percent, and stated it stood ready to expand its purchases of mortgage-related assets as conditions warrant.
The 30-year fixed-rate mortgage fell for the seventh consecutive week, dropping from 5.47 percent a week ago. A year ago the 30-year averaged 6.14 percent. It took a national average 0.7 point to obtain that rate, though; a point is 1 percent of the loan amount, paid upfront as prepaid interest.
Rates on other types of mortgages also dropped this week, although not as much as the 30-year mortgage.
The 15-year fixed-rate mortgage averaged 4.92 percent with an average 0.7 point, down from last week when it averaged 5.20 percent. A year ago the 15-year loan averaged 5.79 percent. The 15-year mortgage has not been lower since April 1, 2004, when it averaged 4.84 percent.
Five-year Treasury-indexed hybrid adjustable-rate mortgages averaged 5.60 percent, with an average 0.6 point, down from last week when it averaged 5.82 percent. A year ago, the 5-year ARM averaged 5.90 percent.
One-year Treasury-indexed ARMs averaged 4.94 percent this week with an average 0.5 point, down from last week when it averaged 5.09 percent. At this time last year, the 1-year ARM averaged 5.51 percent.
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