Mortgage rates fell this week to the lowest
level on record, giving consumers added incentive
to lock in low payments for home purchases and
The average rate for 30-year fixed loans sank
to 4.69 percent, from 4.75 percent last week,
mortgage company Freddie Mac said Thursday.
That's the lowest point since Freddie Mac
began tracking rates in 1971. The previous record
of 4.71 percent was set in December. Rates for
15-year and five-year mortgages also hit
The Obama administration has launched
programs to help borrowers refinance if they owe
up to 25 percent more than their home's value and
have loans owned or guaranteed by mortgage giants
Freddie Mac or Fannie Mae.
About 291,000 homeowners have participated as
Given the costs of refinancing, some mortgage
experts say a refinancing can be worthwhile if you
can shave at least 0.75 percentage point from an
existing rate. Others suggest waiting until you
can lower your rate by at least a point.
Despite some lenders' ads, refinancing is
never free. A fee normally goes to the mortgage
broker or lender. There are also fees for title
insurance, a new appraisal, document processing
and other charges. Often, mortgage brokers or
lenders create the appearance of a "no fee"
mortgage by adding the costs to a total loan
amount or by charging a higher interest
People considering refinancing should factor
in such fees. They should also calculate how many
months it would take to recover them. For those
who expect to stay in their home for two years or
less, the fees might outweigh the savings from a
Rates on 15-year fixed-rate mortgages fell to
an average of 4.13 percent. That was the lowest on
records dating to September 1991. It was down from
4.2 percent a week earlier.
The rates do not include add-on fees known as
points. One point is equal to 1 percent of the
total loan amount.
The nationwide fee for loans in Freddie Mac's
survey averaged 0.7 a point for 30-year loans. The
average fee for 15-year loans was 0.6 of a