Last week, mortgage rates fell to historic lows after a slight uptick the previous week. The average mortgage rate on a 30-year loan fell to 3.54% for the week ending March 21st, after reaching a year-high 3.63% the week before. According to mortgage giant Freddie Mac, 3.63% was the highest rate since August 2012. Rates have also dropped considerably from one year ago, when a 30-year fixed-rate was 4.08%. The average mortgage rate on fifteen-year loans fell to 2.72% last week, after reaching 2.79% the week before.
As a result of these record low mortgage rates, home sales have modestly boosted. The National Association of Realtors reported that in February, existing home sales reached a 3-year high, running at a 4.98 million annual rate. These historic low rates and increasing home sales are good indicators of economic growth. However, a forecast issued last month by mortgage giant Fannie Mae, estimated that 30-year fixed-rates would exceed 4 percent during the fourth quarter of 2013 and would average 4.4% by 2014. If you are planning on purchasing a home, it is better to buy now when you can take full advantage of these historic low interest rates.