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Mortgage rates this year were lowest since 1955, Freddie Mac says

December 30, 2010 |  8:10 am

Rising interest rates have lifted fixed mortgage rates back to the levels of last spring, Freddie Mac said as 2010 wound down, with a reminder that judging by the past ,that's an impressive place to be.

For the year as a whole, 30-year fixed mortgage rates for well-qualified borrowers averaged just below 4.7%, the lowest since 1955, when the typical home price was $22,000, Freddie Mac economist Frank Nothaft said. 

This week's survey of lender offering rates, released Thursday morning by the big loan buyer, showed 30-year fixed-rate mortgages averaged 4.86% with 0.8% of the loan amount paid upfront in lender fees. That compared with 4.81% last week and 5.14% at this time last year. It's about what lenders were offering last May -- still "incredibly low" by historical standards, Freddie Mac said.

Home_lookup_icon This week's average rate for a 15-year fixed mortgage was 4.20% with an average 0.8% of the loan balance paid upfront in lender fees, higher than last week's average of 4.15%. A year ago at this time, the 15-year loan averaged 4.54%, Freddie Mac said.

The five-year Treasury-indexed hybrid adjustable-rate mortgage averaged 3.77% this week, with an average 0.7% in lender fees, up from 3.75% last week. A year ago, the five-year ARM, which becomes variable after five years at a fixed rate, had an average starting rate of 4.44%.

The Freddie Mac survey asks lenders what rates they are offering to borrowers with solid credit, 20% down payments or equivalent equity if they are refinancing their homes, and enough verifiable income to afford the mortgage payments.

Mortgage professionals say these well-qualified buyers often can find slightly better rates if they shop around -- 4.75% this week on average for a 30-year fixed loan, according to FreeRateUpdate.com, which monitors the industry's internal pricing documents.

-- E. Scott Reckard

Graphic credit: Freddie Mac

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