FHFA sees Mortgage Rates Dropping

The average mortgage rates for 30-year fixed mortgages for new home purchases nationwide dropped from 4.18% in January 2012 to 4.08% in February, based on the recent report from the FHFA (Federal Housing Finance Agency).

These mortgage rates represent activities on loans which funded during the week of Feb. 23 to Feb. 29. Typically, the mortgage interest rates are locked 30 to 45 days before a loan is actually closed.

30-year fixed rate mortgages for conventional loans loan dropped 0.05% to 4.36% in February.

The contract rate for all mortgages, both ARM and FRM, hit 4.05% which was 0.09% below the 4.14% in January 2012.

No-point mortgages made up 31% of all purchase loans.  This number fell 3% from the January #. The average loan-to-price ratio in February was 75.3% and the average loan amount was $244,300 in February which climbed $7,300 from January.  In addition to the home purchase mortgages, we anticipate the refinances to pick up also becuase of the new Government program call HARP 2 Refinance Program.  This program allows underwater mortgage holders to refinance to a better rate and lower their monthly mortgage payment.

Gretchen Wegrich

Gretchen Wegrich is an editor at Lender411. She specializes in mortgage basics, personal finance and green living. She graduated with a bachelor's degree in writing from University of California, San Diego and previously worked at the Santa Cruz Sentinel. Contact her at gretchen@lender411com.