Mortgage Trends as of 10.9.09

Experts say not to expect much change in mortgage rates over the next 30 to 45 days.  A small number (14 percent) expect further declines, while slightly more (29 percent) predict an increase.

Average rates for 30-year home loans stayed below 5 percent for the second-straight week, kick-starting refinancing activity, Freddie Mac said Thursday.

The average rate on a 30-year fixed mortgage was 4.87 percent, down from 4.94 percent last week, Freddie Mac said. The last time rates for 30-year home loans were lower was the week ending May 21, when they averaged 4.82 percent.

This week’s average rate for 30-year mortgages remained above the record low of 4.78 percent established in the spring.

Low rates make home buying or refinancing more attractive for consumers. Case in point: refinance applications climbed 18 percent from last week, the Mortgage Bankers Association said Wednesday.

Still, borrowers may want to consider the Federal Reserve’s recent announcement that it is slowing down a program intended to lower mortgage rates and boost the housing market. Analysts say mortgage rates should remain low for now but could eventually move higher, and homeowners who want to refinance mortgages shouldn’t drag their feet.