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Mortgage rates ease a bit, Freddie Mac says

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Mortgage rates eased off this week following last week’s big leap higher, according to the latest surveys of lenders.

The 30-year fixed-rate loan of up to $417,000 averaged 5.0%, down from 5.05% last week, Freddie Mac said in its weekly report. The typical rate for a 15-year fixed mortgage declined to 4.27% from 4.29%. Borrowers would have paid 0.7% of the loan amount to lenders to obtain the rates, Freddie Mac said Thursday.

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In its survey, compiled early each week, the home finance company asks lenders to report what they are offering to borrowers with good credit, 20% down payments or equity in their homes, and sufficient provable income to afford payments.

Well-qualified borrowers who shop around often find slightly better deals, and it’s also possible to pay more upfront to lower the interest rate.

Mortgage rates have rebounded powerfully off record lows seen in November, when Freddie Mac one week put the average offering rate for a 30-year loan at just 4.17%.

Bankrate.com, which also tracks rates, calculated that fixed-rate 30-year mortgages averaged 4.42% in November, resulting in a monthly payment of just above $1,000 on a $200,000 loan. The same size loan would now require almost $90 more a month to pay off, Bankrate said in a survey also released Thursday.

Mortgage experts say lenders remain finicky about providing credit, and the volume of applications for mortgages remains sluggish despite signs of renewed economic growth and rates that by historical standards are amazingly good deals.

Last week, when typical rates jumped by nearly a quarter of a percentage point, applications for refinance loans dropped by 11.4% from the previous week to the lowest level since July 2009, the Mortgage Bankers Assn. said. The trade group report said purchase applications were down by 5.9% after seasonal adjustments.

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‘Last year, the mortgage business was going at warp speed,’ Laguna Niguel mortgage broker Jeff Lazerson said. ‘Since mid-December, new borrowing has become scarce. Folks are waiting for the next price dip to buy, and those that qualified to refinance did the deed in 2010.’

-- E. Scott Reckard

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