Mortgage rates slide to record lows

Mortgage rates continue to drop well below 4 percent. The average rate for a 30 year fixed rate mortgage declined 2 basis points to 3.83 percent since last week, the lowest value on on record for this MBA series. The purchase application volume declined 3.0 percent and the refinance application increased 5.6 percent over the same period.

By SoldAtTheTop,?Guest blogger / May 23, 2012

This chart shows the average interest rates for 15- and 30-year fixed rate mortgages over the past five years. Since peaking in 2008, rates have fallen to record lows.

SoldAtTheTop

Enlarge

The Mortgage Bankers Association (MBA) publishes the results of a weekly applications?survey that covers roughly 50 percent of all residential mortgage originations and tracks the average interest rate for 30 year and 15 year fixed rate mortgages as well as the volume of both purchase and refinance applications.

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Writer, The PaperEconomy Blog

'SoldAtTheTop' is not a pessimist by nature but a true skeptic and realist who prefers solid and sustained evidence of fundamental economic recovery to 'Goldilocks,' 'Green Shoots,' 'Mustard Seeds,' and wholesale speculation.

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The purchase application index has been highlighted as a particularly important data series as it very broadly captures the demand side of residential real estate for both new and existing home purchases.

The latest data is showing that the average rate for a 30 year fixed rate mortgage (from FHA and conforming GSE data) declined 2 basis points to 3.83% since last week, the lowest value on on record for this MBA series, while the purchase application volume declined 3.0% and the refinance application increased 5.6% over the same period.

The following chart shows the average interest rate for 30 year and 15 year fixed rate mortgages since 2006 as well as the purchase, refinance and composite loan volumes (click for larger dynamic full-screen version).

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