Mortgage Rates Fall for Week of Septembr 7

Mortgage rates fell slightly last week, continuing a downward trend that should appeal to anyone buying a home or looking to refinance. With the housing market trending upward in some areas, this could be your last chance for gaining the double benefit of low home rices and low mortgage rates

Mortgage Rates: 30-year Fixed Rate Mortgage, 5/1 ARM Lower

Rates for a 30 year FRM fell from 5.21 percent to 5.16 percent, while average rates for a 5/1 ARM fell slightly from 4.35 to 4.32 percent. For those of you looking for the "magic number" below five percent, this 5/1 ARM may be your best choice. Mortgage rages for 15 year FRMs stayed at an average of 4.67 percent.

Mortgage Loans: Comparing Costs

Whether you're shopping for a new home loan or a refinance, don't forget to factor in your down payment and closing costs. Here are a few things to keep in mind:

• Lower mortgage rates often require paying "points" which represent mortgage interest paid in advance. One point is equal to one percent of your mortgage amount.
• The larger your down payment (or home equity for a refinance), the lower your mortgage rate and lender fees More equity means less risk to the lender, which typically translates to lower closing costs and mortgage rates.
• Get several mortgage quotes, and carefully review and compare them. You may find that the rock bottom lowest rate is not your best deal if the quote carries high lender fees. Using online mortgage calculator tools can help you compare the terms of mortgage loans you're considering.
• Mortgage insurance (MI) is required for mortgage loans of more than 80 percent loan-to-value (LTV). LTV is calculated by dividing the amount of your mortgage loan by the current value of the home you're buying. First-time buyers needing down payment assistance may qualify for local and state homebuyer programs; check with lenders providing quotes to learn more about these programs.

Getting the "big picture" when considering mortgage loans can help in selecting mortgage financing that works for your budget and circumstances.