Mortgage rates down almost a quarter point due to Japan crisis
Mar 2011 17

The average 30-year, fixed mortgage rate is down almost a full quarter point from last year at this time, landing at 4.76% on a national basis, according to the Freddie Mac weekly survey of loan providers.

The 30-year fixed-rate mortgage (FRM) averaged 4.76 percent with an average 0.7 point for the week ending February 24, 2011, down from last week when it averaged 4.88 percent. Last year at this time, the 30-year FRM averaged 4.96 percent, so 20 basis points.

A $400,000, 30-year, fixed-rate mortgage at 4.76 percent would run you approximately $2,089 per month in loan repayments. This is a $26 monthly savings when compared to last week and $48 in savings compared to last year.

This week, 15-year fixed rate mortgages averaged 3.97 percent with an average 0.7 point, down from last week when it averaged 4.15 percent. A year ago at this time, the 15-year FRM averaged 4.33 percent.

Frank Nothaft, vice president and chief economist at Freddie Mac says, ““”With the crisis in Japan, investors rushed to buy the security of U.S. Treasury bonds , which lowered its yields and other interest rates as well. This allowed fixed mortgage rates to drift lower this week.

“In aggregate, families have been strengthening their balance sheets. In the fourth quarter of 2010, household net worth rose by $2.1 trillion, boosted by gains in the stock market. This helped lower their financial obligation ratio (debt payments relative to disposable income) to the lowest level since the first quarter of 1995.”

Basically, we’ve become a nation of hoarders.

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