Interest Rate Roundup for March 10, 2011

Interest Rate Roundup
Mortgage rate graph


  • 5.04% (30-year fixed)
  • 0.42 (average points)

Here's a look at the state of mortgage rates from's weekly national survey of large banks and thrifts conducted March 9, 2011.

Most mortgage rates saw the tiniest of hikes in Bankrate's latest national survey, but a new national study showed that the nation's flood of underwater homes continues to swell as housing prices drop across most of the country.

The benchmark 30-year fixed-rate mortgage averaged 5.04 percent, a gain of just 1 basis point from a week earlier. A basis point is one-hundredth of 1 percentage point.

Most other mortgages followed suit. The 15-year fixed-rate mortgage also climbed 1 basis point, settling at 4.32 percent. However, one important fixed-rate mortgage product fell. The 30-year jumbo mortgage, which is generally defined as loans that are more than $417,000, slipped to 5.58 percent from 5.60 percent a week earlier.

In the adjustable home loan market, the bellwether 5/1 ARM climbed 3 basis points, to 3.88 percent from 3.85 percent. With a 5/1 ARM, the rate is fixed for the first five years and adjusted annually for the remainder of the loan's term.

The mortgage market had declined the three previous weeks, and the overall housing market shows few signs of sharing in the recovery underway in other parts of the American economy.

This week, CoreLogic, a housing data firm, said 11.1 million households, or 23.1 percent of homes with mortgages, were underwater in the fourth quarter of 2010. That was up from 22.5 percent in the previous quarter.

The CoreLogic findings match other recent data, such as the Standard & Poor's/Case-Shiller Home Price indexes, which showed home prices fell last year in 18 of the 20 major metro areas it tracks. Falling prices push more homeowners underwater. In fact, CoreLogic said an additional 2.4 million mortgages are nearing the underwater threshold, which it defined as homes where the owners have less than 5 percent equity.

The number of underwater homes declined in the first three quarters of 2010, largely because of increasing numbers of foreclosures. In the latter part of the year, after a number of legal challenges and allegations of shoddy paperwork, many lenders scaled back their foreclosure activities or ceased them entirely. That had the effect of more owners remaining in underwater homes.

CoreLogic said the state with the most underwater home loans, by far, was Nevada, where roughly two of every three homeowners suffers from what the real estate industry terms "negative equity."

Find out what your monthly mortgage payment could be using Bankrate's mortgage calculator.

-- Gregg Fields




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