Fixed mortgage rates keep falling

The Gershwin standard is “Nice Work If You Can Get It.” The refrain in today’s housing market would be: nice loans — if you can get them.

Fixed mortgage rates have dropped again, marking the sixth straight week of record lows in Freddie Mac’s survey of what lenders are offering to highly qualified borrowers.

Freddie Mac, said Thursday that people with solid credit, 20% down payments or equity in their homes, and sufficient income to handle the loan payments were finding 30-year fixed mortgages at an average 4.54%, down from 4.56% last week and 5.25% a year ago.

Rate offerings for a 15-year fixed mortgage averaged 4%, down from 4.03% last week and 4.69% at this time last year.

The borrowers would have paid 0.7% of the loan amounts in upfront fees and points to the lender, Freddie Mac said.

The interest rates are the lowest since Freddie Mac, a government-sponsored corporation that purchases home loans from lenders, began tracking the 30-year loan in 1971 and the 15-year mortgage in 1991. Solid borrowers who shop around often wind up with even lower rates than those quoted in the lender survey.

For example, Laguna Niguel loan broker Jeff Lazerson said Thursday morning that he was able to get borrowers 30-year loans at 4.125% with 1 point and 15-year mortgages at 3.75% with zero points.

But lenders are serious about ensuring that borrowers are solid. Freddie Mac and Fannie Mae — both wards of Uncle Sam in the aftermath of the mortgage meltdown — purchase virtually all fixed-rate loans. They have tightened the standards for what they will accept, causing lenders to ratchet up their requirements as well.

Tori Richards, a Los Angeles freelance writer, complained in an e-mail of being unable to refinance her mortgage with her current lender, Provident Funding of Burlingame, Calif. Provident was offering the best rate she could find — about 4.2% for a 30-year with less than a point upfront — but apparently not to her.

Richards said she wanted to make some home repairs by taking cash out of the deal. That, coupled with being self-employed, can make it harder to get a loan these days.

“I’ve had my loan there more than 10 years,” Richards said. She said even though she can show several years of good earnings, “they don’t like the fact that I’m a self-employed freelancer,” she added. “Never mind that it makes no sense that my new loan will have a lower monthly payment, making it easier for me to pay, not harder.”

Provident declined to comment.