Mortgage Rates Fall For Third Straight Week

After rising early in 2011, mortgage rates appear to be on their way back down again. The national average rate for a 30-year fixed rate mortgage in the week ending today is 4.87 percent, down from 4.95 percent the week before, according to Freddie Mac.

It’s the third straight weekly decline.

Meanwhile, the average 15-year fixed rate mortgage rell to 4.15 percent and the five-year Treasury-indexed hybrid adjustable rate mortgage averaged 3.73 percent.

"Mortgage rates saw an overall improvement this week. Interest rates for 30-year fixed mortgages were almost 0.2 percentage points below this year's high set just three weeks ago," said Frank Nothaft, vice president and chief economist, Freddie Mac. "This means that homebuyers could now expect to pay $263 less per year on a $200,000 loan."

For buyers, it may be the best of times. Not only are mortgage rates coming down, housing demand still remains weak. New home sales in January were near record lows dating back to 1963 when the data began, according to the Census Bureau . Similarly, pending sales of existing homes fell for the second consecutive month in January, according to the National Association of Realtors.

Even though rates are lower, fewer consumers are getting mortgages. Mortgage applications fell 6.5 percent from one week earlier, according to data from the Mortgage Bankers Association’s Weekly Mortgage Applications Survey.

One reason for the decline is a drop in the number of consumers seeking to refinance existing loans. The refinance share of mortgage activity decreased to 64.9 percent of total applications from 65.7 percent the previous week.