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Up-and-Down Mortgage Rates Have Gone Down Again

Doug Whiteman
Up-and-Down Mortgage Rates Have Gone Down Again

Mortgage rates have been bouncing their way through November like a kid on a trampoline. They're higher, they're lower, they're higher again. This week, they're down — to the lowest levels since Oct. 10.

That means homebuyers have another good opportunity to land a loan with an attractive monthly payment, and homeowners have another chance to cut their interest costs by refinancing.

If you see an good mortgage rate, you may want to think about locking it — and not letting it out of your grasp.

This week's numbers

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Rates on 30-year fixed-rate mortgages have dropped back to an average 3.66% this week, from 3.75% last week, mortgage giant Freddie Mac said Thursday. The loans in the Freddie Mac survey come with an average 0.6 point.

Mortgage rates have been going up one week and down the next since the end of October.

But rates remain considerably lower than they were a year ago, when 30-year mortgages were over a full percentage point higher — at an average 4.94%.

Use this calculator to see the kind of monthly payment you can expect from today's low mortgage rates:

There's still time to refi

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If you took out a home loan even just last year, you might still be able to lower your monthly payment dramatically by doing a refinance into a new loan at a lower rate. Compare refi offers from multiple banks by visiting LendingTree.

Homeowners who refinanced their mortgages during the spring are now saving an average of about $140 a month, or $1,700 a year, Freddie Mac has said.

Refinances are up a whopping 152% compared to this time last year, the Mortgage Bankers Association says. To put it another way, lenders have their hands full with two and a half times as many refi applications as they saw during the fall of 2018.

But refinance applications slumped 8% last week, compared to a week earlier.

Recent dips in mortgage rates may have persuaded homeowners that they don't have to rush to refi — because rates might go even lower.

The outlook for mortgage rates

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Applications for loans to buy homes increased 7% last week.

The numbers of those so-called purchase applications have been rising nicely, and that's a good sign for the economy, says Sam Khater, Freddie Mac's chief economist.

“The housing market continues to steadily gain momentum with rising homebuyer demand and increased construction due to the strong job market, ebullient market sentiment and low mortgage rates,” Khater says.

Rates are expected to stay at bargain-basement levels.

During the remainder of this year, Freddie Mac forecasts that 30-year fixed mortgage rates will average just 3.7%. They're expected to rise just slightly in 2020, to an average 3.8%.

Check today's best mortgage rates where you are.

This week's other mortgage rates

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First-time buyers are helping to drive the demand for homes.

Rates on other varieties of home loans also have gone down this week.

The average for 15-year mortgages has dipped to 3.15%, from 3.2% last week. Those shorter-term home loans are a popular choice for refinancing.

Last year at this time, 15-year fixed-rate mortgages were averaging 4.24%, Freddie Mac says.

Rates also have fallen on 5/1 adjustable-rate mortgages, or ARMs, which are level for five years and then can adjust up — or down — every year after that.

ARMs are currently being offered at an average initial rate of 3.39%, versus 3.44% last week. A year ago, those ARM starter rates stood at an average 4.09%.

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