Rates on 30-year fixed-rate mortgages bounced back from last week’s record lows, averaging 4.81 percent with an average of 0.7 point, Freddie Mac said in releasing the results of its weekly Primary Mortgage Market Survey.

Last week, the 30-year fixed-rate hit a record low of 4.71 percent in records dating back to 1971. The rate remains well below the 5.47 percent reported a year ago, thanks in large part to ongoing Federal Reserve purchases of $1.25 trillion in mortgage-backed securities issued by Fannie Mae, Freddie Mac and Ginnie Mae.

That program is scheduled to wind down at the end of March 2010. The Mortgage Bankers Association in October projected that 30-year fixed-rate mortgages will hit 5.4 percent next year, 6 percent in 2011, and 6.3 percent in 2012 (see story).

Mortgage rates were up this week after an upbeat employment report pushed long-term bond yields up slightly, with fixed mortgage rates following, said Frank Nothaft, Freddie Mac vice president and chief economist.

The economy shed only 11,000 jobs in November, far fewer than forecast, and the unemployment rate unexpectedly fell to 10 percent, Nothaft noted.

The 15-year fixed-rate mortgage averaged 4.32 percent with an average of 0.6 point this week, up from 4.27 percent last week but down from 5.2 percent a year ago. Last week’s rate for 15-year fixed mortgages was a low in records dating back to 1991.

The 5-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) averaged 4.26 percent this week, with an average 0.5 point, up from 4.19 percent last week but down from 5.82 percent a year ago. The 5-year Treasury-indexed ARM reached a record low of 4.18 percent in the last week of November.

The 1-year Treasury-indexed ARM averaged 4.24 percent this week with an average 0.7 point, down slightly from 4.25 percent last week and 5.09 percent a year ago.

Rates surveyed by Freddie Mac are for prime borrowers taking out loans with 20 percent downpayments. Borrowers taking out loans too large or risky for purchase or guarantee by Freddie Mac can expect to pay more.


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