Fifteen-Year Fixed-Rate Mortgages Dip Below the Three Percent Mark

Freddie Mac has released the results of its Primary Mortgage Market Survey (PMMS), showing fixed mortgage rates following bond yields lower to new all-time record lows as the 30-year fixed-rate mortgage (FRM) averaged 3.75 percent with an average 0.8 point for the week ending May 31, 2012, down from last week when it averaged 3.78 percent. Last year at this time, the 30-year FRM averaged 4.55 percent. And for the first time in history, the 15-year FRM dipped below the three percent mark this week, averaging 2.97 percent with an average 0.7 point, down from last week when it averaged 3.04 percent. A year ago at this time, the 15-year FRM averaged 3.74 percent.  "Market concerns over tensions in the Eurozone led to a decline in long-term Treasury bond yields helping to bring fixed mortgage rates to new record lows this week," said Frank Nothaft, vice president and chief economist, Freddie Mac. "Compared to a year ago, rates on 30-year fixed mortgage rates are almost 0.9 percentage points lower which translates into nearly $1,200 less in annual payments on a $200,000 loan. Meanwhile, the S&P/Case-Shiller 20-city composite home price index (not seasonally adjusted) showed annual home-value gains in March in seven cities and a monthly gain in 12 cities." Also this week, the five-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) averaged 2.84 percent this week, with an average 0.6 point, up from last week when it averaged 2.83. A year ago, the five-year ARM averaged 3.41 percent. The one-year Treasury-indexed ARM averaged 2.75 percent this week, with an average 0.4 point, unchanged from last week. Last year at this time, the one-year ARM averaged 3.13 percent.