Mortgage rates were lower for the second week in a row, with the average conforming 30-year fixed mortgage rate falling to 6.60 percent. According to Bankrate.com's weekly national survey of large lenders, the average 30-year fixed mortgage has an average of 0.39 discount and origination points.

The average 15-year fixed rate mortgage popular for refinancing dropped to 6.14 percent, while the average jumbo 30-year fixed rate is now 7.61 percent. Adjustable mortgage rates were mostly higher, with the average 1-year ARM rising to 6.28 percent and the average 5/1 ARM inching up to 6.27 percent.

The ongoing credit crunch continues to impact all borrowers through higher rates. With the spread between benchmark Treasury yields and rates on fixed mortgages at the highest levels in 22 years, borrowers are seeing rates that are one full percentage point higher than normal. From 1985 until the onset of the credit crunch one year ago, the average difference between fixed mortgage rates and yields on 10-year Treasury notes was 1.64 percentage points. Today, that difference is 2.8 percentage points. The higher borrowing costs reflect the perceived risk investors wish to be compensated for as well as additional fees layered on by Fannie Mae and Freddie Mac.

Although mortgage rates have been relatively calm in recent weeks, it has been a wild ride for much of 2008. Seven months ago, the average 30-year fixed mortgage rate was 5.88 percent, meaning that a $200,000 loan would have carried a monthly payment of $1,183.71. But at today's rate of 6.6 percent, a $200,000 loan would mean a monthly payment of $1,277.32.