Mortgage rates dipped below 4% for only the second time in the past 40 years, according to the weekly survey issued this morning by Freddie Mac. This past week’s average of 3.99% is the second lowest — only the Oct. 6 rate of 3.94% was lower — in records dating back to April 1971. We asked Jeff Lazerson, of Mortgage Grader in Laguna Niguel, to give us his weekly take …

NEWS SUMMARY-From Freddie Mac’s weekly survey the average 30-year fixed rate dropped below 4 percent for the second time this year (and only the second time since 1971). Rates came in at 3.99 percent with an average of .7 point. Last week Freddie reported 4.00 as the average rate. Fifteen year fixed rates averaged one basis point lower at 3.30 with .7 point. Last week the 15-year fixed was 3.31 percent with .7 point. The 5-year ARM popped up slightly to 2.98 percent from the previous week’s rate of 2.96 percent and .6 point.

WHAT I SEE-From rate sheets hitting my desk that are not part of Freddie Mac’s survey: A true jumbo 30-year fixed rate mortgage ($625,501 to $2,000,000) is 4.5 percent and 1 point. A 5-year ARM no-closing cost is 3.375 percent. Home loans for landlords are running at 4.25 percent. ROI can be very solid for investment properties.

WHAT I THINK-Fannie and Freddie combined own 30 million mortgages. Estimates are that 25 percent of all mortgages are underwater. Next week, HARP II details will be unveiled. Government predictions are this new streamlined loan program with no appraisal will assist another million borrowers stay in their homes. I believe the number will be double that. Freddie Mac chief economist Frank Nothaft told me yesterday, “I don’t think we are going to see 30-year mortgages going hugely lower. I don’t see a double-dip recession.” He added, “I don’t see much growth either.” Consider your mortgage rate now to see if you can reduce your financing costs because this is about as good as it’s going to get.

More stories about today’s interest rate report …

You can follow any responses to this entry through the RSS 2.0 feed.