Tags: US | Mortgage | Rates

Mortgage Rates Sink to Year Low of 4.78 Percent

Thursday, 27 May 2010 10:32 AM

Mortgage rates have fallen to the lowest level of the year as European turmoil caused investors to pour money into the safe haven of U.S. government securities.

The average rate on a 30-year fixed rate mortgage dipped to 4.78 percent this week from 4.84 percent a week earlier, mortgage company Freddie Mac said. It was the lowest level since early December, when rates fell to a record low of 4.71 percent.

Concerns over the European debt crisis have sent yields for 10-year and 30-year Treasury bonds to their lowest levels of 2010. Rates on 30-year home loans often rise and fall in line with the 10-year note.

A campaign by the Federal Reserve to reduce borrowing costs for consumers pushed rates down to extraordinarily low levels last year. Rates were expected to rise after the program ended this spring. Instead, they have dipped. Fears that Greece's government would default on its debt shook world markets and boosted demand for U.S. Treasuries.

Freddie Mac collects mortgage rates on Monday through Wednesday of each week from lenders around the country. Rates often fluctuate significantly, even within a given day.

This week, the average rate on a 15-year fixed-rate mortgage was 4.21 percent. That's down from 4.24 percent last week and the lowest level on records dating back to August 1991.

Rates on five-year, adjustable-rate mortgages averaged 3.97 percent, up from 3.91 percent a week earlier. Rates on one-year, adjustable-rate mortgages fell to 3.95 percent from 4 percent. That was the lowest average since May 2004.

The rates do not include add-on fees known as points. One point is equal to 1 percent of the total loan amount.

The nationwide fee for loans in Freddie Mac's survey averaged 0.7 a point for 30-year, 15-year and 5-year loans. The average fee for 1-year loans was 0.6 of a point.

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Mortgage rates have fallen to the lowest level of the year as European turmoil caused investors to pour money into the safe haven of U.S. government securities.The average rate on a 30-year fixed rate mortgage dipped to 4.78 percent this week from 4.84 percent a week...
US,Mortgage,Rates
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2010-32-27
Thursday, 27 May 2010 10:32 AM
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