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

This article was originally on a blog post platform and may be missing photos, graphics or links. See About archive blog posts.

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.

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