Fixed Rates See New Bottom

The search for a new low is still on as fixed-rates continue to break record-lows week after week. According to ""Freddie Mac's survey"":http://www.freddiemac.com/pmms/, fixed rates fell again following reports showing a slowdown in consumer spending and the manufacturing industry.

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The 30-year fixed-rate mortgage fell to 3.62 percent (0.8 point) for the week ending July 5. Last week, it averaged 3.66 percent, and last year at this time, it was 4.60 percent.

The 15-year fixed-rate dropped down to 2.89 percent (0.7 point) from last week's 2.94 percent. A year ago at this time, the 15-year FRM averaged 3.75 percent.

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The 5-year ARM remained unchanged from last week at 2.79 percent (0.6 point). Last year, the 5-year ARM averaged 3.30 percent.

The 1-year ARM also broke a record-low and averaged 2.68 percent (0.5 point). Last week it averaged 2.74 percent, and last year, the 1-year ARM was 3.01 percent.

""Recent economic data releases of less consumer spending and a contraction in the manufacturing industry drove long-term Treasury bond yields lower over the week and allowed fixed mortgage rates to hit new all-time record lows,"" said Frank Nothaft, VP and chief economist for Freddie Mac.

Nothaft explained that that consumer spending in April was revised from a 0.3 percent gain to 0.1 percent and was unchanged in May, while manufacturing shrank in June for the first time since July 2009.

""Bankrate's"":http://www.bankrate.com/ survey also saw declines this week, with the average 30-year fixed mortgage rate hitting a new low of 3.87 percent, falling from last week's 3.89 percent. The 15-year fixed fell to 3.13 percent, down from 3.16 percent last week.

Bankrate uses data provided by the top 10 banks and thrifts in the top 10 markets, and Freddie Mac's survey includes about 25 lenders from ""five regions"":http://www.freddiemac.com/pmms/abtpmms.htm#7.