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Bankrate: More Record Lows for Mortgage Rates
added: 2011-09-02

Mortgage rates reset record lows this week, with the benchmark conforming 30-year fixed mortgage rate falling to 4.37 percent, according to's weekly national survey. The average 30-year fixed mortgage has an average of 0.38 discount and origination points.

The average 15-year fixed mortgage plunged to 3.48 percent while the larger jumbo 30-year fixed rate tied a record low of 4.89 percent. Adjustable rate mortgages moved into record territory also, with the average 5-year ARM dropping to 3.07 percent and the 7-year ARM sliding to 3.23 percent. Both are record lows.

Many of the adjustable rate mortgages have initial interest rates so low they're bordering on the ridiculous. On the 5/1 ARM, which carries a fixed rate for the first five years, some lenders are offering rates at 2.5 percent or below. On the 7/1 ARM, a number of lenders have the fixed rate for the first seven years below 3 percent. While these rates are plenty tempting for borrowers that don't imagine being in the home more than 10 years, some of these loans are now priced in such a way that rates can only go up in the future. Be very sure about your timetable or your ability to bank the savings in the meantime, as rising monthly payments would be a virtual certainty in later years.

The last time mortgage rates were above 6 percent was Nov. 2008. At the time, the average 30-year fixed rate was 6.33 percent, meaning a $200,000 loan would have carried a monthly payment of $1,241.86. With the average rate now 4.37 percent, the monthly payment for the same size loan would be $997.98, a difference of $243 per month for anyone refinancing now.


30-year fixed: 4.37% - down from 4.41% last week (avg. points: 0.38)

15-year fixed: 3.48% - down from 3.63% last week (avg. points: 0.32)

5/1 ARM: 3.07% - down from 3.12% last week (avg. points: 0.4)


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