NEW YORK – A retiring couple in Hebron, Conn., that recently considered refinancing their roughly $70,000 home loan has never been more attractive to the $5.3 trillion market for government-backed mortgage bonds.

The homeowners, who were leaving jobs in insurance and as a municipal worker, contacted Norcom Mortgage after seeing new loan rates had fallen a percentage point below what they’re paying, according to Greg Radding, a manager of retail production at the firm.

After Radding ran through the math of how little they would save each month and closing costs of about $3,000, they opted to keep their current loan.

Borrowers with small loans frequently make that decision, Radding said.

“They often just don’t feel like they’re getting much bang for their buck,” he said. “What’s 50 bucks? It’s just not worth it to them.”

Mortgage investors, anxious over the record prices of government-backed securities, are paying unprecedented extra amounts for the types of bonds considered the least likely to prepay quickly, such as those backed by loans of less than $85,000.

Bondholders paying more than face value risk losses if enough homeowners take out new mortgages to repay their existing debt. The securities have risen even as refinancing soars, driven by expanded government programs and loan rates that have set all-time lows for six straight weeks.

Average values for agency mortgage bonds reached almost 109 cents on the dollar this month, bolstered by a jump in so-called pay-ups. That’s the extra amount investors pay for specific bonds above prices in trading where they don’t know exactly which securities they’re buying. FTN Financial says the cost of the refinancing protection, which in some cases now exceeds 5 cents on the dollar, has “skyrocketed.”

“With just how high MBS prices are, it’s very, very difficult to buy generic pools because you’re so at risk,” said John Anzalone, head of structured securities portfolio management at Atlanta-based Invesco, which oversees about $650 billion. “The higher the premium at risk is, the more you should be willing to pay for protection.”

Bonds guaranteed by taxpayer-supported Fannie Mae and Freddie Mac or U.S.-owned Ginnie Mae averaged 108.65 cents on the dollar on July 20, the peak since at least 1986, Bank of America Merrill Lynch index data show.

The debt, which has fallen to 108.48, is up from 107.59 at the start of this year. Gains amid Europe’s debt crisis and speculation the Federal Reserve may expand its bond purchases to bolster the economy drove down the average rate on a typical 30-year mortgage to 3.49 percent the week ending July 27, from 3.95 percent at the end of 2011, according to Freddie Mac data.

The rally partly reflects bond buyers’ belief that the refinancing boom will be limited by obstacles ranging from lenders’ constrained capacity and tight standards to consumers’ frustrations with banks and weakened finances, with even generic securities reaching records.

Two-thirds of investors surveyed in late July by JPMorgan Chase are “overweight” mortgage securities, or holding more than found in benchmark bond indexes. Almost 80 percent expect the Fed to buy more of the debt, with 57 percent forecasting an announcement at or before its September meeting, according to a July 27 report by the bank’s analysts.

Refinancing applications climbed to a three-year high late last month that was more than 57 percent greater than this year’s low in March, according to a Mortgage Bankers Association index.

Still, the pace remained 46 percent below a 2003 peak.

Mortgage-bond investors are willing to pay the price for protection against homeowners joining the wave.