Consumers looking to consolidate debt by refinancing their mortgage loans and lowering their payment may be able to benefit from stabilizing rates.
According to Freddie Mac’s latest Primary Mortgage Market Survey forthe week ending March 18, One-year adjustable-rate mortgages were the only type of mortgage to see their average rates decline, as they fell by 0.1 percentage points to hit 4.12 percent. One week earlier the average rate had seen a 0.05 percentage point drop.
Five-year ARMs were not as fortunate as their average rate increased by 0.04 percentage points to hit 4.09 percent for the week. One week earlier, the rate had dropped 0.06 percentage points.
"With house prices starting to stabilize and even rise, homeowners on aggregate are slowly building back equity in their homes based on figures from the Federal Reserve Board," said Frank Nothaft, Freddie Mac’s vice president and chief economist. "After losing almost $7.9 trillion in home equity since the end of 2006, homeowners regained almost $1.1 trillion over the past three quarters ending in 2009."
The average rate for 30-year fixed-rate mortgage saw a slight increase of 0.01 percentage points to hit 4.96 percent for the week, nearly offsetting the 0.02 percentage point decline in the rate seen the week period.
Fifteen-year FRMs also saw their average rate increase slightly by 0.01 percentage points to hit 4.33 percent for the week. The rise in the rate was enough to cancel out the 0.01 percentage point decline the rate had seen one week earlier.