Fixed mortgage rates looked cheaper than ever in Freddie Mac’s weekly survey Thursday morning as the 15-year rate dropped below 3% for the first time ever and the 30-year set a new low for the fifth consecutive week in a row.
The 30-year dropped three basis points to 3.75% with an average of 0.8 of a point while the 15-year slid seven basis points to 2.97% with an average of 0.7 of a point.
A 30-year borrower who took out a $200,000 loan a year ago would save about $1,200 per year if he or she refinanced today, Freddie Mac chief economist Frank Nothaft said in his weekly report. A year ago, the average weekly 30-year survey rate was 4.55%.
In contrast to the drop in fixed rates, the average five-year Treasury-indexed hybrid rate during the week ending May 31 inched up a basis point to 2.84% carrying 0.6 of a point. The average rate for a one-year Treasury adjustable-rate mortgage remained the same at 2.75% but carried just 0.4 of a point.
Rates still remain relatively lower than a year ago for five-year Treasury hybrids and one-year Treasury ARMs as they respectively carried rates of 3.41% and 3.13% at that time. Separate research Freddie Mac has done suggests these types of loans generally remain much less popular than fixed-rate products.
