n
Mortgage rates slip for fourth straight week
NEW YORK (CNNMoney.com) -- Mortgage rates fell for the fourth week in a row, bringing the 30-year rate to its lowest level since April, on signs of weakness both in the housing sector and in the larger economy, Freddie Mac reported Thursday.
The average rate on 30-year fixed-rate loans fell to 6.52 percent for the week ending Aug. 17 from 6.55 percent the week before, reaching its lowest level since April 20.
A year ago, the 30-year mortgage rate averaged 5.80 percent. The last time the 30-year rate was this low was the week of April 13, 2006.
"Long term rates continue to relax as economic reports support a picture of a weakening housing sector and a slower-growing economy," Frank Nothaft, Freddie Mac vice president and chief economist said in a prepared statement. "This week's news that July housing starts fell 2.5 percent added conviction to Fed Fund futures traders who are currently pricing contracts to suggest the chances of another rate increase from the central bank this year are about 50-50.
"As a result, 30-year fixed-rate mortgages are down for the fourth straight week and are the lowest they've been since mid-April. Meanwhile, ARM rates have gone down less. All of which could help persuade homeowners with ARMs on the verge of resetting to make the decision to lock into a fixed-rate mortgage now rather than take a chance of a higher rate on the adjustment date."
Freddie Mac said the 15-year rate was unchanged from the previous week at an average of 6.20 percent. A year ago, the 15-year rate averaged 5.40 percent.
The last time the 15-year rate was this low was the week of May 18, 2006.
Five-year adjustable-rate mortgages fell to 6.18 percent from 6.21 percent last week.
The five-year ARM averaged 5.34 percent a year ago.
The average one-year adjustable-rate mortgage fell to 5.65 percent from 5.69 percent the previous week. At this time last year, the loan averaged 4.58 percent.