Mortgage Rates Fall for First Time in Five Weeks

Thursday, 15 Apr 2010 12:03 PM


  Comment  |
   Contact Us  |
|  A   A  
  Copy Shortlink
U.S. mortgage rates have fallen for the first time in five weeks, retreating from an eight-month high and remaining near historically low levels, a closely watched mortgage survey showed on Thursday.

The move should bode well for the hard-hit housing market, making homes more affordable during the most important period, the spring selling season.

Interest rates on U.S. 30-year fixed-rate mortgages, the most widely used loan, averaged 5.07 percent for the week ended April 15, down from the previous week's 5.21 percent, which was its highest in eight months, according to a survey released by Freddie Mac, the country's second-largest mortgage finance company.

That is up from 4.82 percent a year ago as well as the record low of 4.71 percent seen in early December. Freddie Mac started the survey in 1971.

"After rising for four consecutive weeks, mortgage rates eased back to where they were two weeks ago and still remain historically low," Frank Nothaft, Freddie Mac vice president and chief economist, said in a statement.

Mortgage rates are linked to yields on Treasuries and yields on mortgage-backed securities.

Rates are widely expected to rise this year as the economy improves and after the Federal Reserve ended its program of purchases of mortgage-related securities last month.

Earl Lee, president of Prudential Real Estate and Relocation Services, based in Scottsdale, Arizona, said he has seen home sales pick up, with first-time home buyers competing for homes.

The federal government's $8,000 first-time home buyer tax credit and a $6,500 credit for home owners buying a new residence will soon expire. Eligible borrowers must sign contracts by April 30 and close loans by June 30.

"Emotionally I would like to see mortgage rates go lower, but factually they are destined to go higher," Lee said.

"Some home buyers are so hung up on home prices right now, waiting for them to fall further, but higher mortgages rates could end up offsetting that benefit," he said.

The Mortgage Bankers Association said on Wednesday U.S. mortgage applications fell for a second straight week, with a slump in demand for government loans driving activity to its lowest level in three months.

Freddie Mac said the 15-year fixed-rate mortgage averaged 4.40 percent in the latest week, down from 4.52 percent the prior week.

Interest rates on other types of loans fell.

One-year adjustable-rate mortgages (ARMs) were 4.13 percent in the latest week, down from 4.14 percent a week earlier. The rate on the 5/1 ARM, set at a fixed rate for five years and adjustable each following year, was 4.08 percent, compared with 4.25 percent a week earlier.

A year ago, 15-year mortgages averaged 4.48 percent, the one-year ARM 4.91 percent and the 5/1 ARM 4.88 percent.

© 2014 Thomson/Reuters. All rights reserved.

  Comment  |
   Contact Us  |
  Copy Shortlink
Around the Web
Join the Newsmax Community
Please review Community Guidelines before posting a comment.
>> Register to share your comments with the community.
>> Login if you are already a member.
blog comments powered by Disqus
Retype Email:
Zip Code:
Privacy: We never share your email.
Hot Topics
Follow Newsmax
Like us
on Facebook
Follow us
on Twitter
Add us
on Google Plus
Around the Web
Top Stories
You May Also Like

US Hikes Fees for Renouncing Citizenship

Sunday, 31 Aug 2014 22:22 PM

The United States has more than quadrupled the fee to renounce citizenship as record numbers of citizens file to become  . . .

Rabbi Boteach: New York Times Censored Our Anti-Radical Islam Ad

Sunday, 31 Aug 2014 22:13 PM

The New York Times has censored an advertisement taken out by the pro-Jewish group This World: The Values Network, its e . . .

Report: Doctors Bringing Joan Rivers Out of Medical Coma

Saturday, 30 Aug 2014 18:19 PM

Comedian Joan Rivers, who went into cardiac arrest at a doctor's office, was being brought out of her medically induced  . . .

Most Commented

Newsmax, Moneynews, and Independent. American. are registered trademarks of Newsmax Media, Inc. Newsmax TV, NewsmaxWorld, NewsmaxHealth, are trademarks of Newsmax Media, Inc.

America's News Page
©  Newsmax Media, Inc.
All Rights Reserved