Several benchmark mortgage rates receded in the Detroit area this week.
Benchmark 30-year rate shows decline in Detroit
The average rate on the benchmark 30-year fixed-rate mortgage for the Detroit area declined to 4.09 percent, according to Bankrate's national survey of large lenders. The local rate was below the national average rate of 4.18 percent, and was down 2 basis points from last week. A basis point is one-hundredth of 1 percentage point.
The mortgages in the survey for the current week had an average of 0.11 discount and origination points.
"The drop in the 30-year fixed spells great news for those who waited to lock on a rate, as their decision paid off," says Holden Lewis, Bankrate's senior mortgage analyst.
Monthly payments on a hypothetical $165,000 mortgage fell to $796.32, falling $1.91 from last week, corresponding with the drop in mortgage rates.
Other Detroit mortgage types decline
Jumbo mortgages are used for loan amounts above limits set by the Federal Housing Finance Agency; for the Detroit area, that limit is $424,100.
The average rate for 15-year fixed-rate mortgages slipped 2 basis points as well, reaching 3.32 percent. Monthly payments on a hypothetical $165,000, 15-year fixed-rate mortgage followed rates on the decline, decreasing $1.61 to $1,165.03.
"The 15-year fixed is a popular mortgage for homeowners who want to refinance. With this downward trend in the 15-year fixed, a refinance will be more profitable to some homeowners," Lewis says.
The benchmark 5/1 adjustable-rate mortgage diminished to 3.43 percent this week, a drop of 10 basis points. The most common type of variable-rate mortgage, 5/1 ARMs allow property owners to pay a fixed rate for the first five years, and the rate adjusts once per year every year after.
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Weekly mortgage survey
|Results from Bankrate's survey of mortgage lenders conducted 1/18/2017. Monthly payments are for a $165,000 loan. The jumbo rate is for the minimum jumbo loan amount of $424,100 in the Detroit area.|
|30-year fixed||15-year fixed||5-year ARM||30-year jumbo|
|This week's rate:||4.09%||3.32%||3.43%||4.13%|
|Change from last week:||-0.02||-0.02||-0.10||-0.03|
|Change from last week:||-$1.91||-$1.61||-$9.14||-$7.39|
Methodology: The "Bankrate.com National Average," or "national survey of large lenders," is conducted weekly. To conduct the National Average survey, Bankrate obtains rate information from the 10 largest banks and thrifts in 10 large U.S. markets. In the Bankrate.com national survey, our Market Analysis team gathers rates and/or yields on banking deposits, loans and mortgages. We've conducted this survey in the same manner for more than 30 years, and because it's consistently done the way it is, it gives an accurate national apples-to-apples comparison.
To learn more about the different rate averages Bankrate publishes, see "Understanding Bankrate's Rate Averages."