Sara Routhier, Managing Editor of Features and Outreach, has professional experience as an educator, SEO specialist, and content marketer. She has over five years of experience in the insurance industry. As a researcher, data nerd, writer, and editor she strives to curate educational, enlightening articles that provide you with the must-know facts and best-kept secrets within the overwhelming worl...

Full Bio →

Written by

Joel Ohman is the CEO of a private equity-backed digital media company. He is a CERTIFIED FINANCIAL PLANNER™, author, angel investor, and serial entrepreneur who loves creating new things, whether books or businesses. He has also previously served as the founder and resident CFP® of a national insurance agency, Real Time Health Quotes. He also has an MBA from the University of South Florida. ...

Full Bio →

Reviewed by Joel Ohman
Founder, CFP®

UPDATED: Mar 21, 2013

Advertiser Disclosure

Advertiser Disclosure: We strive to help you make confident loan decisions. Comparison shopping should be easy. We are not affiliated with any one loan provider and cannot guarantee quotes from any single provider. Our partnerships don’t influence our content. Our opinions are our own. To compare quotes from many different companies please enter your ZIP code on this page to use the free quote tool. The more quotes you compare, the more chances to save.

Editorial Guidelines: We are a free online resource for anyone interested in learning more about loans. Our goal is to be an objective, third-party resource for everything loan related. We update our site regularly, and all content is reviewed by experts.

The spring homebuying season brings low mortgage loan interest rates this week according to Freddie Mac survey results.

The average fixed mortgage rates reversed their course from last week and fell this week.

Len Kiefer, deputy chief economist at Freddie Mac, said the housing market has a strong seasonal pattern that repeats yearly.

“In the winter months, home construction slows due to weather conditions,” Kiefer told loans.org. “Homebuyers typically don’t shop as much as in the winter, but realtors see increased traffic in the spring.”

During the spring and summer seasons, or Q2 and Q3, housing prices and home sales both increase rapidly.

For the week ending March 21, 2013, the 30-year fixed rate for mortgages averaged 3.54 percent with a 0.8 point average, down from last week’s short-term high of 3.63 percent.

If a borrower took out a $200,000 home loan at today’s mortgage loan interest rate of 3.54 percent, his or her monthly payment would be $902.56. After 30 years, he or she would pay a total of $324,921.60.

If a borrower took the same mortgage out one year ago when mortgage loan interest rates were 4.08 percent, they would pay $964.08 monthly, for a total cost of $347,068.80 after 30 years. Using the current mortgage loan interest rate rather than last year’s, borrowers would save $22,147.20.

In addition, the survey found the 15-year FRM averaged 2.72 percent with a 0.7 point average, down from last week when it averaged 2.79 percent. The 5-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) averaged 2.61 percent with a 0.6 point, the same as last week. Finally, the 1-year Treasury-indexed ARM averaged 2.63 percent with an average 0.4 point average, down from 2.64 percent last week.

The National Association of Home Builders Index, which tracks builder confidence, decreased in February and fell from 46 to 44. The index found that reduced confidence was due to a lack of buildable land and increased material and labor costs and not a lack of buyer demand.

Frank Nothaft, vice president and chief economist at Freddie Mac, said that low and stable inflation is putting downward pressure on fixed mortgage rates.

On March 20, the Federal Reserve monetary policy committee lowered the upper end of its inflation forecast for the current year.

Although Freddie Mac cannot comment on the Federal Reserve’s decisions to lower the forecast, Kiefer said that for bankers or investors to lend out money for thirty years, which is the most common length for a home loan, they must be compensated for several factors including the “possibility that inflation will erode the real value of the mortgage loan.”

“With inflation very low, and more importantly, expected to remain low, investors demand less compensation to be willing to lend funds over 30 years. If inflation fears increase, banks and investors might well demand higher compensation in the form of higher interest rates,” Kiefer said.