Mortgage Rates Dip Below 4%

By Steven Shaw on 10/21/2014


Mortgage Rates Dip Below 4%

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People thought it wouldn’t happen this year, but it did: Average 30-year fixed mortgage rates dipped below 4% last week, hitting their lowest level in 2014, Freddie Mac said in a news release.

The 30-year fixed-rate mortgage averaged 3.97% last week, down from 4.12% the week prior and 4.28% the same time last year. That average hasn’t been below 4% since the week of June 20, 2013, when it was 3.93%. Each week, Freddie Mac surveys lenders on the rates, fees and points on their most popular mortgage products, and it releases the Private Mortgage Market Survey averages for various home loan products.

The 15-year fixed-rate mortgage declined from the prior week and previous year, as well, to 3.18%. Adjustable-rate mortgages also dropped, hitting 2.92% for the 5-year ARM and 2.38% for the 1-year ARM.

For anyone in the house-hunting stage, this is welcome news. Rates have been low all year, but there’s a lot of savings to be gained from seemingly small numerical shifts in interest rates.

Interest-rate averages are only part of the equation when figuring out how much you can expect to pay for your home loan. Low rates may be available, but you have to qualify for them, which you can hope to achieve with a good credit history and applying for a home well within your budget.

If you want to take advantage of low mortgage rates, make sure you’re as prepared as possible for the homebuying process. Your potential lender will check your credit, so make sure you do it first, to see if you have anything you can improve quickly or if there are errors that could sabotage your mortgage plans. (You can get two free credit scores every 30 days from

You’ll also want to make sure you’re in a good position to buy a home, and you’ll need the paperwork to prove it. Organize your finances, determine how much house you can afford (we have a tool for that), and focus on finding a home that will fit in your monthly budget after accounting for things like loan interest, mortgage insurance, homeowners’ association fees and other costs associated with homeownership.

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