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Refinancers save $3 billion in a year

Mortgage interest rates have been bobbing around record-low territory through much of the summer, which led to a boom in refinancing. Freddie Mac said Monday that 30-year fixed-rate mortgages averaged only 5.1 percent during the first nine months of this year, which is the lowest interest rate in the 38 years Freddie Mac has tracked those loans. People who refinanced during the July-September quarter cut their interest rates by an average of 1.1 percentage points, and they stand to save $3 billion, all together, over the first 12 months of their new loan.

Only 36 percent of refinancers took cash out--the lowest share in six years. The median age of their old loan was 3.5 years. Another telling statistic: The median appreciation of the refinanced property was 0 percent during the third quarter. Zero. In the third quarter last year the median appreciation was 16 percent. And it was as high as 34 percent back in 2006. What a difference.

By Elizabeth Razzi  |  November 3, 2009; 6:00 AM ET
Categories:  Mortgages , Statistics , The economy , The market  
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