Mortgage Rates Ease Closer to Record Lows: 30-Year at 3.32%

Fixed mortgage rates decreased slightly this week, with the 30-year fixed coming within one basis point of its record low, according to Freddie Mac.
The 30-year loan came in at 3.32 percent, easing from 3.34 percent last week. Last month, the longterm rate set a record low of 3.31 percent.
The Federal Reserve yesterday said its key federal funds rate would remain near zero as long as the unemployment rate was above 6.5 percent (it is currently at 7.9 percent) and inflation did not rise above 2.5 percent.
Fed Chairman Ben Bernanke told reporters that the Fed’s actions would continue to keep interest rates artificially low until 2015.
The Fed’s policy committee voted to buy $45 billion a month in long-term Treasuries and continue purchasing $40 billion a month in mortgage-backed securities.
In its forecast for next year, Freddie Mac said long-term mortgage rates will remain near their record lows for the first half of 2013, then rise gradually in the second half of the year.
However, rates should remain below 4 percent, according to Freddie Mac’s housing market outlook.
Additionally, property values should continue to increase steadily, with most U.S. house price indexes moving up 2 to 3 percent in 2013.
Here is Freddie Mac’s overview of mortgage rates for this week:
• 30-year fixed-rate mortgage averaged 3.32 percent, with an average 0.7 point, for the week ending December 13, 2012, down from last week when it averaged 3.34 percent. Last year at this time, the 30-year FRM averaged 3.94 percent.
• 15-year FRM this week averaged 2.66 percent, with an average 0.6 point, down from last week when it averaged 2.67 percent. A year ago at this time, the 15-year FRM averaged 3.21 percent.
• 5-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) averaged 2.70 percent this week with an average 0.6 point, up from last week when it averaged 2.69 percent. A year ago, the 5-year ARM averaged 2.86 percent.
• 1-year Treasury-indexed ARM averaged 2.53 percent this week with an average 0.5 point, down from last week when it averaged 2.55. At this time last year, the 1-year ARM averaged 2.81 percent.

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