According to Freddie Mac Primary Mortgage Market Survey, rate are up again after a slight dip last week during the July 4th holiday.

The average rate for a 30 Year Fixed mortgage went up 0.1% to 6.73% while a 15 year fixed mortgage averages 6.39%, an 0.09% increase.

The 1 Year ARM average interest remained the same at 5.71% while the 5/1 Year ARM increased to 6.35% from 6.29%.

Source:http://www.freddiemac.com/dlink/html/PMMS/display/PMMSOutputYr.jsp?year=2007 

Before you make any kind of purchase, big or small, you should do some amount of research to make sure that you’re getting a good deal for your money. When refinancing your mortgage, it’s absolutely essential that you do your research in order to avoid overpaying on your loan.

Here are some things to keep in mind when researching interest rates.

The goal of a mortgage refinance is to lower your finance payments by providing you with a loan that has a lower interest rate. If your financial situation has improved since you took out your original mortgage, you have a good chance of qualifying for lower interest rates on a mortgage refinance loan.

Two factors that will definitely affect your new interest rate are the length of the loan period and the type of loan that you are applying for. Typically, Adjustable Rate Mortgages will start you off with lower interest rates than a fixed rate mortgage, and loans with shorter durations will get you rates lower than a loan with a longer period. However, these general trends do not justify one type of loan over another.

Not every refinancing option is good for every situation. If you pick the wrong type of loan, you may overpay in thousands of dollars and could potentially lose your house if you can’t make your finance payments.

When shopping for refinance loans, it’s important to make your decision based on more than just the interest rates. Lower interest rates alone do not automatically mean the loan is the best option for you. Some mortgage programs offer low rates to their customers only to charge thousands of dollars in fees to recoup their profits. Considering the average homeowner refinances or sells every 7 to 10 years, it is not a wise decision to take out a high-fee loan strictly to receive lower interest rates.

This week, for the third straight week in a row, interest rates have dropped.

Keep in mind that generally when you see headlines saying rates have dropped, the loan product is usually a 30 year, or 15 year  fixed mortgage. This doesn’t mean that rates are not lower across the board, but ARM rates generally do not make the headlines.  When you see headlines like this, and you have a loan with a higher interest rate, or a short term (a 3 year ARM, or something like that), you may want to talk to a trusted mortgage professional and weigh your options.

It is also interesting to note that mortgage application volume compared to last year has increased. Additionally, the volume of mortgage applications for new purchases increased this week.   This means that despite the drop in the real estate market, consumers are still looking to finance their property dreams.

Remember, when you have a mortgage, it pays to be prudent, and keep in tune with the mortgage market.    If you are looking to become a property owner soon, be sure to check national websites, and know exactly what the average rates look like.  That way, when you receive a rate quote, you will know if what you are being offered is in line with the marketplace.

When shopping around for mortgage interest rates, there are several things you can do to improve your chances of getting a very competitive rate from a reliable lender. Things like improving your credit, shopping around, and getting rate guarantees will all help you to find the best rates available.

First things first, take stock of your credit and review your overall financial situation. By paying all of your bills on time and keeping low balances on your credit cards, you can improve your credit score. A good credit score is essential to getting a low interest rate, since mortgage lenders use your score to determine what type of risk is inherent with offering you a loan.

One way to improve your standing in the eyes of a mortgage lender is to close any unneeded credit accounts. This includes things like department store credit cards, regular credit card accounts, and any other accounts that you don’t need. If you have a lot of credit accounts, lenders will see that you are capable of racking up a large amount of debt. This increases your risk level, and subsequently, the interest rates that they will offer you.

When shopping around for mortgage interest rates, get the lender to guarantee you the rate in writing. Some lenders may ask you for payment in order to get this guarantee, but if the rate is good enough, it might be worth it. Just make absolutely sure that the rate is locked in for a period of time that will allow you to close the loan first.

If you have cash on hand and want a lower interest rate, you should consider paying points. Points are basically pre-paid interest on your loan that will get you a lower monthly payment. However, points are not for everybody. If you are going to stay in your house long enough to recoup the expense of paying points, then the savings you receive from your lower interest rate will be worth it.

Freddie Mac (NYSE:FRE) today released the results of its Primary Mortgage Market Survey® (PMMS®) in which the 30-year fixed-rate mortgage (FRM) averaged 6.63 percent with an average 0.4 point for the week ending July 3, 2007, down from last week when it averaged 6.67 percent. Last year at this time, the 30-year FRM averaged 6.79 percent.

The 15-year FRM this week averaged 6.30 percent with an average 0.4 point, down from last week when it averaged 6.34 percent. A year ago, the 15-year FRM averaged 6.44 percent.

Five-year Treasury-indexed hybrid adjustable-rate mortgages (ARMs) averaged 6.29 percent this week, with an average 0.4 point, down from last week when it averaged 6.30 percent. A year ago, the 5-year ARM averaged 6.39 percent.

One-year Treasury-indexed ARMs averaged 5.71 percent this week with an average 0.4 point, up from last week when it averaged 5.65 percent. At this time last year, the 1-year ARM averaged 5.83 percent.

http://www.freddiemac.com/dlink/html/PMMS/display/PMMSOutputWk.jsp?week=27&ending=20070705

“Long-term mortgage rates continued to move lower for a third consecutive week, in part reflecting a moderation in core inflation,” said Frank Nothaft, Freddie Mac vice president and chief economist. “In the statement accompanying their decision to leave the target federal funds rate unchanged, the Fed noted that core inflation had declined recently, though a ’sustained’ moderation is still to be seen, and signaled that inflation risk continues to figure prominently in their policy decisions.

“Helping to ease some inflation concerns, May’s personal consumption expenditures report found that the core price measure had increased 1.9 percent for the year ending in May, within the 1 percent to 2 percent range with which the Fed is comfortable, and the lowest year-over-year rise in more than 3 years.”

Freddie Mac is a stockholder-owned company established by Congress in 1970 to support homeownership and rental housing. Freddie Mac fulfills its mission by purchasing residential mortgages and mortgage-related securities, which it finances primarily by issuing mortgage-related securities and debt instruments in the capital markets. Over the years, Freddie Mac has made home possible for one in six homebuyers and more than four million renters in America.

Before you begin shopping for mortgage interest rates, it’s important to familiarize yourself with two of the common factors that will affect the terms of your loan: points and lock-in periods.

If you are simply contacting lenders and asking for information on their interest rates, you probably won’t be able to make even comparisons between different companies. One lender might quote you on a no-point loan, while another may give you the interest rate for a 2 point loan. Or a lender could quote you on a 7-day lock while another gives you the information for a 45-day lock. You need to tell each lender specifically what you’re looking for so you can get comparable quotes from several different lenders.

When you start calling mortgage companies, you need to know two things: how many points you would like to pay and how long you want to lock in your rate for. Even if you aren’t necessarily intent on locking in your rate, it’s important to give the same information to all lenders in order to receive comparable quotes. It’s also very important to call all of the lenders on your list on the very same day. Since rates don’t stay the same every day, calling lenders on different days will get you extremely different quote ranges.

When shopping around, you can’t place much trust in advertisements that you come across in your local paper, on television, or on the radio. These advertisements were most likely submitted a day in advance at the very least, and therefore, interest rates have probably changed since they were written.

Most ethical loan officers will give you a reliable quote when you contact them, even if they know that you’re shopping around. However, there are some lenders out there that aren’t always truthful. They may exaggerate their rates or promise things they can’t really deliver. Some may even go as far as to increase your interest rates at the last possible moment when there is little you can do to get out of the contract.

If you want to avoid unethical lenders, it is a good idea to get referrals from people who were pleased with the service they received from their lenders. Shop around for interest rates from this exclusive list of reputable mortgage companies.