Mortgage Rates Fall Again, Average 2.91%

August 28, 2020

© REALTOR® MAGAZINE

Mortgage rates remain near all-time lows, and many economists believe they will stay for the remainder of this year and well into next year.

“This year has been anything but normal and as the uncertainty lingers, mortgage rates remain” low, says Sam Khater, Freddie Mac’s chief economist. “These rates continue to incentivize potential buyers and the home buying season, which shifted from spring to summer, will likely continue into the fall.”

The Federal Reserve this week announced the adoption of a more flexible policy to achieve inflation that averages 2% over time. “This significant change can keep interest rates low for longer periods, which could translate into both long periods of cheap mortgages and a strong job market,” the National Association of REALTORS® said in a statement. “More and more home buyers and homeowners are expected to take advantage of these ultra-low rates.”

Freddie Mac reports the following national averages with mortgage rates for the week ending Aug. 27:

• 30-year fixed-rate mortgages: averaged 2.91%, with an average 0.8 point, dropping from last week’s 2.99% average. The 30-year fixed-rate mortgage hit an all-time low of 2.88% at the beginning of this month. A year ago, 30-year rates averaged 3.58%.

• 15-year fixed-rate mortgages: averaged 2.46%, with an average 0.7 point, falling from last week’s 2.54% average. A year ago, 15-year rates averaged 3.06%.

• 5-year hybrid adjustable-rate mortgages: averaged 2.91%, with an average 0.2 point, unchanged from last week’s average. A year ago, 5-year ARMs averaged 3.31%.

Freddie Mac reports average commitment rates along with average fees and point stop reflect the total upfront cost of obtaining the mortgage.

Source: Freddie Mac