Average Mortgage Rate Drop Spurs Refinancing Activity

Freddie Mac (NYSE:FRE) today released the results of its Primary Mortgage Market Survey® (PMMS®) in which the 30-year fixed-rate mortgage (FRM) averaged 5.16 percent with an average 0.7 point for the week ending February 12, 2009, down from last week when it averaged 5.25 percent. Last year at this time, the 30-year FRM averaged 5.72 percent.

"Interest rates for 30-year fixed-rate mortgages are almost 1.5 percentage points below 2008's peak set on July 24, 2008, offering many homeowners an incentive to refinance," said Frank Nothaft, Freddie Mac vice president and chief economist. "This would translate into a monthly payment savings of around $188 on a $200,000 mortgage".