Mortgage rates dip below 4 percent, refinancing surges

WASHINGTON — Angst over rising mortgage rates appears to be overdone, at least in the near term, as the average rate on 30-year mortgages fell below 4 percent again this week.

Freddie Mac reported that a 30-year, fixed-rate mortgage averaged 3.95 percent in the week ending May 25, down from 4.02 percent the previous week.

Average 30-year rates are now at the lowest level of the year.

A year ago, such mortgages averaged 3.64 percent.

A 15-year, fixed-rate mortgage averaged 3.19 percent this week, down from 3.27 percent. A five-year, adjustable rate mortgage — an increasingly popular choice for borrowers — averaged 3.07 percent, down from 3.13 percent.

“As we predicted, the 30-year mortgage rate fell 7 basis points this week in a delayed reaction to last week’s sharp drop in Treasury yields,” Freddie Mac chief economist Sean Becketti said.

Lower rates are drawing existing homeowners, who are looking for a better mortgage, back into the market.

The Mortgage Bankers Association reported that mortgage applications rose 4.4 percent last week — led by an 11 percent increase in refinancing applications, the highest level since March.

Jeff Clabaugh

Jeff Clabaugh has spent 20 years covering the Washington region's economy and financial markets for WTOP as part of a partnership with the Washington Business Journal, and officially joined the WTOP newsroom staff in January 2016.


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