Long-term interest rates for home loans continue to drop, marking the third consecutive week they’ve declined. Frank Nothaft, Freddie Mac’s VP and chief economist, explained that fixed mortgage rates are now down about half a percentage point from early June levels, when they began heading upward.
""Freddie Mac"":http://www.freddiemac.com released the results of its ""Primary Mortgage Market Survey"":http://www.freddiemac.com/pmms/release.html on Thursday, which showed the average interest rate for 30-year fixed-rate mortgages (FRMs) at 5.14 percent (0.7 point). That figure is down from last week when the 30-year FRM averaged 5.20 percent. Last year at this time, it was 6.26 percent.
Nothaft said, ""For a 30-year fixed-rate mortgage, the rate reduction over the past five weeks translates into a monthly payment savings of $56 on a $200,000 loan.""
According to Freddie Mac’s study, the 15-year FRM this week averaged 4.63 percent (0.7 point), down from last week when it was 4.69 percent. A year ago at this time, the 15-year FRM was averaging 5.78 percent.
Five-year adjustable-rate mortgages (ARMs) averaged 4.83 percent this week (0.7 point). The 5-year ARM rose slightly from last week when it was 4.82 percent. A year ago, the 5-year ARM was 5.80 percent.
Freddie Mac reported the average rate for 1-year ARMs at 4.76 percent this week (0.5 point). Last week, the 1-year ARM was 4.82 percent, and at this time last year, it was 5.10 percent.