Digital News Report – Mortgage interest rates were lower again for the week ending on August 19th, 2010 with Freddie Mac announcing their Weekly Primary Mortgage Market Survey as a 30-year fixed-rate mortgage averaging 4.42 percent, a 15-year fixed-rate mortgage average of 3.90 percent and a 5 year hybrid adjustable-rate mortgage (ARM) averaging 3.56 percent.
Both the 30-year fixed and the 15-year fixed rate mortgage loans were down from the previous week. The 5-year ARM remained the same from the week before.
Freddie Mac reported that refinancing activity in the second quarter of 2010 had over 95 percent of the loans being a fixed-rate mortgage. This was the case if their previous loan was adjustable or a fixed rate. Because of the low interest rates there was more people refinancing to a 15-year fixed rate mortgage than in the past. However, the majority of refinancing home loans was to a 30-year fixed rate mortgage.
There was more people putting cash-in of their own to refinance. This could be because lenders are requiring a higher equity in the home in order to qualify. In the second quarter of 2010 there was 22 percent of those refinancing that paid off the value off the loan amount. There still was 27 percent that added to the cost of the mortgage when they refinanced.
Mortgage interest rates are at a 50 year low which has made it attractive for homeowners to refinance their existing home loan. Even first time homebuyers will benefit from the lower interest rates.
By: Victoria Brown