Historical home mortgage rates


It's difficult to believe that mortgage interest rates are now officially at the lowest point in history.

Or, at least, the lowest point in history as defined by the Freddie Mac, which has been keeping track of 15-year fixed-rate mortgages since 1991.

In its weekly survey of national primary mortgage market interest rates, Freddie Mac found that the 15-year rate dropped to 2.56 percent. The 30-year rate stayed just above its all-time record low at 3.35 percent, or just a smidgen above the all-time record low set in 1971, some 42 years ago.

What does it say about our economy that mortgage interest rates are at the lowest point since 1971?

Do you remember where you were in 1971? That year, the U.S. had come off the highest inflationary year since the Korean War stated, and as the year continued, inflation rose, taxes increased and so did the unemployment rate.

In August, then-President Richard Nixon announced a freeze on all prices and wages in the United States. "The time has come for decisive action, action that will break the vicious circle of spiraling prices and costs, " he said. "I am today ordering a freeze on all prices and wages throughout the United States for a period of 90 days. I am relying on the voluntary cooperation of all Americans, each one of you -- workers, employers, consumers -- to make this freeze work. Working together, we will break the back of inflation."

President Nixon thought he had found a way out. But by 1973, thanks to the oil embargo, the U.S. was deep into a tough recession that lasted until 1975 and featured stagflation, a combination of high unemployment and high inflation.

This time, our economic malaise looks a lot different. We have had extremely high unemployment but low inflation. For a while, some economists were warning of possible deflation, when prices go down instead of up.

Our unemployment rate is dropping, but that seems to be because so many people have thrown up their hands and left the job market permanently. The labor participation rate is at the lowest point in several decades, with some 3 million fewer Americans employed than before the recession began in 2007. About 12 million Americans are out of work, nearly half for six months or longer.

All-time low for mortgage rates

2012-11-21 14:04:33 by jonlansner

From Freddie Mac’s weekly survey, and for the second week in a row, we have new all-time record lows on the 30-year and 15-year fixed rate home loans. The average 30-year fixed rate dropped to 3.31 and .7 point from last week’s 3.34 percent and .7 point. The 15-year fixed landed at 2.63 percent and .7 point, down from last week’s 2.65 percent. The 5-year ARM remained the same from last week at 2.74 percent and .6 point.
BOTTOM LINE: In the past year—assuming a well-qualified borrower received the average 30-year conforming fixed rate on $417,000; the savings would be $157 on his new monthly payment of $1,828 compared to one year ago when rates averaged 3

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  • Avatar Wendy Is it too soon to opt for a fixed rate mortgage?
    Jan 27, 2010 by Wendy | Posted in Personal Finance

    I m on a great SVR with my currently mortgage provider but with inflation rising I m worried mortgage rates will soon rise too. Should I hold my nerve?

    • Is it too soon? NO. You ask a very good question. However, you may want to consider the opposite as well. Is it too late? Well, not yet. As of January 2010, fixed mortgage rates are at or very close to historical lows. Financial experts and the media are indicating that these historical lows do not expect to stick around much longer. With that in mind, your variable rate loan, tied to an index directly linked to the market, is low now. However, it will rise in the not so distant future if the experts are correct. With that in mind, it is imperative that you assess your plans for the future as they …