Freddie Mac's Primary Mortgage Market Survey found the average rate for 30-year, conforming, fixed-rate mortgages (FRMs) had fallen to 5.64 by Oct. 28, down from 5.69 the week before. That's not far off this year's low point, 5.38 percent, hit on March 18. Last year at this time, rates were 6.05 percent for 30-year mortgages.

One-year, adjustable-rate mortgages (ARMS), indexed to treasury notes, averaged 3.96 percent, down from last week's 4.02 percent average level, but up slightly from last year's average of 3.76 percent, Freddie Mac officials said.

Mortgage Market To Remain Buff

Rates will be lower than expected next year and the mortgage market will stay strong for the next 10 years, according to industry leaders who spoke during this week's annual Mortgage Bankers Association conference in San Francisco, CA's Moscone Center.

Slower economic growth next year should hold average mortgage rates to 6.5 percent or lower throughout 2005, according to a mortgage trade group's forecast. That's down from the 6.75 percent originally predicted for the end of this year.

Interest rates for 30-year, fixed-rate mortgages should finish this year almost a full percentage point lower than expected -- 5.9 percent on average -- said Doug Duncan, chief economist for the association.

Fannie Mae's CEO Franklin Raines estimated borrowers will sign for $11 trillion to $14 trillion in mortgage capital over the next decade. Richard Syron from Freddie Mac predicted U.S. mortgage debt outstanding will double in the coming years, resulting in 10 million new homeowners by 2013.

Home Ownership, Home Sales Jump

More Americans than ever -- 73.7 million -- own their own home.

U.S. Census Bureau data released this month says the current number is 323,000 more than the previous record high set in the second quarter of 2004 and nearly 1.6 million more than a year ago.

"These numbers combined with news that sales of previously owned homes jumped 3.1 percent in September, show that housing continues to lead the way in our rapidly recovering economy," said Housing and Urban Development Secretary Alphonso Jackson.

Sales of existing single-family homes rose again to a seasonally adjusted annual rate of 6.75 million units in September, after two consecutive monthly declines, according to the National Association of Realtors.

The sales pace is the third-highest pace on record and 1 percent above the 6.68-million pace of a year ago, NAR said.

Mortgage rate declines since June get the credit for higher sales.

"Since 1971 there have been only five months when mortgage interest rates were lower, and all of those have been during the last year and a half," said David Lereah, NAR's chief economist.

Saving Homes From Foreclosure A Win-Win

There is life as a homeowner after a default on the mortgage payment.

A new study shows that delinquent mortgage holders who enter a lender-sanctioned plan to pay the arrears are 80 percent less likely to lose their homes than those who do not. Even among lower-income borrowers, 68 percent of those who join a mortgage catch-up program manage to save their homes.

Revealing why it's important to run to your lender and not away from it when you fall delinquent on your mortgage, a study by George Washington University and Freddie Mac reveals mortgage payment recovery programs can be quite effective.

Offered to more than half of all seriously delinquent borrowers with loans owned or insured by Fannie Mae, Freddie Mac and the Federal Housing Administration, the programs that put borrowers back on track vary widely.

Loan modifications contractually change the terms of the mortgage, typically to reduce payment amounts. Partial reinstatement plans allow borrowers to resume regular payments, while paying off the arrears over an agreed-to period of time. Lenders advance money to homeowners so they can make back payments, provided the borrower signs an agreement to repay the advance when he or she pays off the mortgage with a sale or other transaction.

It's a win for borrowers who get to keep their home and a win for lenders who save an average $60,000 they would likely lose to foreclosure, the study said.

Published: October 29, 2004

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Broderick Perkins parlayed a career in old-school journalism into a contemporary digital news service that really hits home. The award-winning consumer journalist, originally from Wilmington, DE, is founder, publisher and executive editor of the bootstrap DeadlineNews Group, a Silicon Valley-based editorial content and consulting service specializing in residential real estate, consumer news and related editorial consulting services. The DeadlineNews Group includes the website, DeadlineNews.com, offering real estate editorial content and consulting services, and its back shop, the Deadline Newsroom, an open house on news that really hits home. Perkins obtained his formal journalism education from University of Delaware and a journalism boot camp, the Institute of Journalism Education at the University of California-Berkeley. He went on to 20 years of service as a daily newspaper journalist at the Wilmington, DE News Journal and San Jose, CA Mercury News. Perkins covered housing on the San Jose Mercury News reporting team which earned a General News Reporting Pulitzer Prize in 1989 for coverage of the Loma Prieta earthquake. He has also produced real estate, consumer and small business content for the Wall Street Journal, Los Angeles Times, RealtyTimes.com, Nolo.com, Better Homes and Gardens, the National Association of Realtors, Homestore/Move and Intuit/Quicken among more than three dozen publications. In addition to managing the DeadlineNews Group, Perkins most recently served as chief editorial consultant for Nolo's Essential Guide To Buying Your First Home, Nolo, and writes real estate television scripts for RealtyTimes.com.