Mortgage rates ended 2008 on a downswing, with the average 30-year fixed mortgage rate falling to 5.64 percent. According to Bankrate.com's weekly national survey, the average 30-year fixed mortgage has an average of 0.39 discount and origination points.


The average 15-year fixed rate mortgage dropped to 5.16 percent, while the average jumbo 30-year fixed rate slumped to 7.14 percent. Adjustable rate mortgages moved lower as well, with the average 1-year ARM dipping to 5.97 percent and the average 5/1 ARM pulling back to 5.86 percent.

The average rate on a 30-year fixed rate mortgage has fallen more than one full percentage point, from 6.77 percent to 5.80 percent, since Oct. 29. Most of that decline has come since the Federal Reserve's Thanksgiving week announcement of $600 billion destined for mortgage-backed securities. Rates were lower this week after the Fed provided some additional details on how they'll pump $500 billion of that money into mortgage-backed securities beginning in Feb. 2009. Low mortgage rates will be a theme in 2009 as Fed and Treasury policies aim to stabilize the housing market by facilitating refinancing and enticing home buyers into the marketplace.

The sharp decline in mortgage rates since Halloween has sparked a refinancing frenzy. Nine weeks ago, the average 30-year fixed mortgage rate was 6.77 percent, meaning a $200,000 loan would have carried a monthly payment of $1,299.86. With the average rate having since fallen to 5.64 percent, the monthly payment on a $200,000 loan is now $1,153.21.

SURVEY RESULTS

30-year fixed: 5.64 - down from 5.84% last week (avg. points: 0.39)
15-year fixed: 5.16% - down from 5.46% last week (avg. points: 0.39)
5/1 ARM: 5.86% - down from 5.95% last week (avg. points: 0.41)