Mortgage rates fall back and remain in refi territory for many borrowers

Mortgage rates fell this week after the Federal Reserve kept rates unchanged and the Brussels terror attacks disrupted international markets.

Investors have been retreating to the safety of government bonds, which has pushed yields down. The 10-year Treasury yield fell from a high of 1.94% to an intraday low of 1.88%. Mortgage rates typically follow the direction of yields on long-term government bonds

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A look at rates this week

  • The benchmark 30-year fixed-rate mortgage fell to 3.9% from 3.93%, according to Bankrate's March 23 survey of large lenders. A year ago, it was 3.8%. The rate was also 3.8% 4 weeks ago. The mortgages in this week's survey had an average total of 0.17 discount and origination points. Over the past 52 weeks, the 30-year fixed has averaged 4%. This week's rate is 0.10 percentage points lower than the 52-week average.
  • The benchmark 15-year fixed-rate mortgage fell to 3.13% from 3.17%.
  • The benchmark 30-year fixed-rate jumbo mortgage fell to 3.81% from 3.84%.
  • The benchmark 5/1 adjustable-rate mortgage fell to 3.36% from 3.43%.

Weekly national mortgage survey

Results of's March 23, 2016, weekly national survey of large lenders and the effect on monthly payments for a $165,000 loan:

30-year fixed15-year fixed5-year ARM
This week's rate:3.90%3.13%3.36%
Change from last week:-0.03-0.04-0.07
Monthly payment:$778.25$1,149.80$728.09
Change from last week:-$2.84-$3.20-$6.40

Mortgage analysis

Mixed housing data

February's median price was $301,400; the average price was $348,900. There was 5.6 months' worth of housing inventory at the end of the month.

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Separate data from the National Association of Realtors show sales of existing homes plunged 7.1% in February, falling from a seasonally adjusted annual rate of 5.47 million transactions in January, to 5.08 million.

"Demand was off across the nation, though the Northeast and Midwest led the way with double-digit declines," Joel Naroff , president and chief economist at Naroff Economic Advisors in Holland, Pennsylvania, says in a blog post . "One of the biggest problems holding back the market is supply."

We could soon see a pickup in activity now that the spring homebuying season is underway, says Jeff DerGurahian , executive vice president of capital markets at loanDepot in Foothill Ranch, California.

Time to lock?

Mortgage applications fell by 3.3%, for the second consecutive week, according to the Mortgage Bankers Association's weekly survey. Purchases and refinances fell 1% and 5%, respectively.

There isn't a lingering fear of an impending spike in mortgage rates, says Brian Koss , executive vice president for Mortgage Network in Danvers, Massachusetts.

"If the rates make sense, it would be a great time to lock it, but it also shouldn't be a feeling (of) 'If I don't move now, I'll never see a rate like this again,'" he says.

DerGurahian advises potential borrowers to take a look at 1 mortgage product in particular.

"It's still a great time to get a 30-year fixed-rate mortgage," he says.

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