NEW YORK,-- Mortgage rates moved lower for a second consecutive week, hitting a 14-month low. The benchmark 30-year fixed mortgage rate fell to 4.24 percent, and has an average of 0.28 discount and origination points according to Bankrate.com's weekly national survey.
The average 15-year fixed mortgage rate moved a touch lower to 3.37 percent, while the larger jumbo 30-year fixed mortgage rate sank to 4.29 percent. Adjustable rate mortgages were also lower, with the 5-year ARM slipping to 3.28 percent and the 7-year ARM stepping down to 3.49 percent, both three-month lows.
Muted inflation readings and ongoing tensions in hotspots around the globe helped fuel demand for bonds, pushing mortgage rates lower. Mortgage rates are closely related to yields on long-term government bonds. Any time there is reason for nervousness among investors, their movement into the perceived safe haven of bonds is good news for mortgage rates. Low inflation has also been a boon for bond demand as inflation erodes the fixed payments bond holders receive.
As 2013 came to a close, the average 30-year fixed mortgage rate was 4.69 percent. At that time, a $200,000 loan would have carried a monthly payment of $1,036.07. Mortgage rates have moved lower thus far in 2014, and with the average rate now 4.24 percent, the monthly payment for the same size loan would be $979.25, a savings of nearly $57 per month for anyone that waited.
30-year fixed: 4.24% -- down from 4.27% last week (avg. points: 0.28)
15-year fixed: 3.37% -- down from 3.39% last week (avg. points: 0.17)
5/1 ARM: 3.28% -- down from 3.324% last week (avg. points: 0.15)