Mortgage rates fell slightly this week, with the average rate on 30-year fixed-rate mortgages inching further below 5%, according to Freddie Mac's weekly survey.Rates edged lower as the market awaited the outcome of the Federal Reserve's policy-setting committee meeting Wednesday, according to Frank Northaft, Freddie's chief economist. The Fed voted to keep interest rates near zero.The 30-year fixed-rate mortgage averaged 4.98% for the week ended Thursday, down slightly from last week's 4.99% average and 5.1% a year ago.
Rates on 15-year fixed-rate mortgages were 4.39%, down from 4.4% last week and 4.8% a year earlier.Five-year Treasury-indexed hybrid adjustable-rate mortgages averaged 4.25%, down from last week's 4.27% and 5.27% a year earlier. One-year Treasury-indexed ARMs were 4.29%, down from 4.32% last week and 4.9% a year earlier.Borrowers seeking to improve their mortgages through a government program will soon find the paperwork a little less cumbersome.
The Treasury Department announced on Thursday that it was streamlining the Making Home Affordable program in the hope of increasing the number of successful modifications. Starting June 1, mortgage companies participating in the program will be required to collect a borrower’s financial documents as part of the initial application process.Now, most borrowers are first enrolled in a trial modification program, then asked for more extensive documentation. Borrowers complain that the servicers routinely lose the documents, causing delays and preventing the modification from becoming permanent.
In another change, instead of having to submit their W-2 tax statement, borrowers will submit two pay stubs and an electronic form allowing access to their tax returns.“We’re making it as easy as possible,” an assistant Treasury secretary, Herbert M. Allison Jr., said in a conference call with reporters.The changes were announced within hours of the two big government-controlled mortgage finance companies reporting that their delinquency rates had increased again. The reports showed that the mortgage crisis was nowhere near ending.
The proportion of single-family home loans in Freddie Mac’s portfolio that were at least 90 days past due rose to 3.87 percent in December, up from 3.72 percent in November and more than double the rate of 1.72 percent in December 2008. For Fannie Mae, whose numbers are one month older, the delinquency rate in November was 5.29 percent, up from 4.98 percent in October and 2.13 percent in November 2008.Consumer advocates who had been expecting, or at least hoping, for a major revamp of the program expressed disappointment at the scope of the changes.
