US Rates on 30-Year Mortgages Sink

A year ago, 2006  rates on
30-year mortgages stood at 6.79 percent,
15-year mortgages were at 6.44 percent,
five-year adjustable-rate mortgages averaged 6.39 percent
one-year ARMs were at 5.82 percent


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AP
Rates on 30-Year Mortgages Sink
Thursday July 5, 11:32 am ET
By Jeannine Aversa, AP Economics Writer 
Rates on 30-Year Mortgages Drop to Lowest Level Since Early June, Good News for Homebuyers

WASHINGTON (AP) -- Rates on 30-year mortgages sank this week to a one-month low, while rates on most other mortgages also fell, good news to prospective home buyers.
Freddie Mac, the mortgage company, reported Thursday that 30-year, fixed-rate mortgages averaged 6.63 percent. That was down from last week's 6.67 percent rate and was the lowest since early June, when rates stood at 6.53 percent.

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The moderation is welcome for people in the market to buy a home. In mid-June, rates on 30-year mortgages climbed to 6.74 percent, an 11-month high.

Rates on many mortgages have ebbed in recent weeks as investors' fears about an inflation have eased.

"Long-term mortgage rates continued to move lower for a third consecutive week, in part reflecting a moderation in core inflation," which excludes food and energy prices, said Frank Nothaft, Freddie Mac's chief economist.

The Federal Reserve in deciding to hold a key interest rate steady last week noted that some readings on core inflation have improved. The Fed's key rate has been at 5.25 percent for a year, offering borrowers a period of steadiness.

Some other mortgage rates tracked by Freddie Mac also showed declines this week.

Rates on 15-year, fixed-rate mortgages, a popular choice for refinancing, fell to 6.30 percent from 6.34 percent last week. And, rates on five-year adjustable-rate mortgages averaged 6.29 percent, down slightly from last week's 6.30 percent.

However, rates on one-year adjustable-rate mortgages rose to 5.71 percent this week, compared with 5.65 percent last week.

The mortgage rates do not include add-on fees known as points. All mortgage types each carried a nationwide average fee of 0.4 point last week.

A year ago, rates on 30-year mortgages stood at 6.79 percent, 15-year mortgages were at 6.44 percent, five-year adjustable-rate mortgages averaged 6.39 percent and one-year ARMs were at 5.82 percent.

After a five-year boom, the housing market fell into a slump last year. Sales turned weak as did home prices. The slump is expected to drag on probably through the rest of this year.

Freddie Mac: http://www.freddiemac.com