New record low mortgage rate

According to Freddie Mac's Primary Mortgage Market Survey for the week ending January 19, the 30-year fixed-rate mortgage average dropped to a new record low of 3.88 percent, making the seventh consecutive week that it's below 4 percent.

The 15-year fixed-rate mortgage averaged 3.17 percent, up from 3.16 percent the week before. Frank Nothaft, vice president and chief economist for Freddie Mac, said mixed economic reports in the retail, consumer, home production and price indices kept mortgage rates low for the week.

Freddie Mac also released the results of its 28th Annual Adjustable-Rate Mortgage Survey of prime loan offerings. The ARM survey found ARM rates are at historic lows and hybrid ARMs are still the most popular adjustable-rate product on the market.

Nothaft said homebuyers started to avoid ARMs over concerns about associated risks.

"Borrowers who have taken out ARMs generally prefer hybrids, because these products include an extended initial period where the interest rate is fixed," Nothaft said. "ARMs today are financing just over 10 percent of new home purchase loans. "

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