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Mortgage Rates head south and dip a little lower

traders are pondering how long the low trend will last
traders are pondering how long the low trend will last
Photo by Spencer Platt/Getty Images

For the fourth reporting week of 2014, Fixed Rate mortgages continue to head south and the average is 4.390%. The dip is really not that significant as it is only 2 basis points down from the previous week. The important note is the trend-line bodes well for those in a position to obtain a new purchase or refinance their existing mortgage.

Loan applications are down

Another key point in this week’s number is lenders are retooling from end of the year activity. Mortgage applications have been flat which results in fewer consumers opting for mortgage money. In the weeks ahead that number is forecast to improve, especially as the purchase market picks up. The end result or bigger question is how long rates in the mid-four range will.

Demand is key metric

Mortgage rates are cyclical and based on demand, so as volume is down rates will move down. On the other hand as demands picks up, they too move.

Here is a quick snapshot of this week’s survey

  • Fixed Rate 30 Year - 4.39 %
  • Fixed Rate 15 Year 3.44 %
  • 5/1 ARM - 3.15 %
  • 1 Yr, ARM - 2.54 %

The weekly rate survey is an industry standard that Freddie Mac publishes. The data is an average of what lenders are offering consumers on a week by week basis.

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