Loans.org Reports Downward Spiral for Mortgage Rates
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UPDATED: Apr 18, 2013
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Mortgage interest rates headed down towards record lows this week according to interest rate reports on loans.org.
Strong reports at the beginning of 2013 have softened, resulting in reduced mortgage interest rates.
For the week ending April 18, 2013, the 30-year fixed-rate mortgage (FRM) averaged 3.34 percent. This rate is down from last week’s average of 3.37 percent.
According to RealtyTrac, the nation’s median home value in Q3 of 2012 was $185,200. If the average borrower took out a $185,200 home loan, the overall cost would be significantly less now than it would have been one year ago.
At today’s mortgage interest rate of 3.34 percent, his or her monthly payment on the $185,200 home loan would be $815.18. After 30 years, he or she would pay a total of $293,464.80.
One year ago, the 30-year FRM averaged 3.90 percent, according to Freddie Mac. If a borrower took the $185,200 loan out one year ago when mortgage interest rates were 3.90 percent, they would pay $873.53 monthly, for a total cost of $314,470.80 after 30 years. Using the current mortgage interest rate rather than last year’s, borrowers would save $21,006 over the lifetime of their loan.
The 15-year fixed-rate mortgage averaged 2.53 percent, down from last week when it averaged 2.57 percent.
The 5/1 adjustable-rate mortgage (ARM) averaged 2.26 percent, which is down from last week’s rate of 2.31 percent.
Weekly rates moved lower amid reports of weak consumer spending. According to U.S. Census trade reports, retail sales fell 0.4 percent in March, making that the second reduction in three months.
Consumer spending reduced in accordance to a reduction in consumer spending. The University of Michigan consumer sentiment index dropped 6.3 points in April. The index fell to 72.3, the lowest reading since July 2012.