30-Year Rates Fall Below 6% As Market Turbulence Continues
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Saturday, October 11, 2008
The average rate on 30-year mortgages fell below 6 percent this week, its first decline in three weeks.
Freddie Mac reported Thursday that 30-year, fixed-rate mortgages averaged 5.94 percent this week, down from 6.10 percent last week. It marked the first decline since the week of Sept. 18, when rates fell to 5.78 percent, a seven-month low.
Financial markets have been turbulent in recent weeks as investors have flocked to the safety of Treasury securities, sending those yields down sharply while rates on other types of corporate bonds have been pushed higher by growing concerns about whether the bonds will be repaid.
Those crosscurrents have been reflected in mortgage rates, which hit a high for the year, 6.63 percent, in late July and then dropped below 6 percent in mid-September.
"Longer-term mortgage rates fell for the first time in three weeks, roughly following bond-market yields," said Frank E. Nothaft, chief economist for Freddie Mac.
Rates on 15-year, fixed-rate mortgages, which are popular with people who are refinancing, dropped to 5.63 percent from 5.78 percent.
Rates on five-year, adjustable-rate mortgages fell to 5.90 percent from 6.00 percent. Rates on one-year adjustable mortgages edged up to 5.15 percent from 5.12 percent.
The mortgage rates do not include add-on fees known as points. The fees nationwide for 30-year, 15-year, five-year and one-year mortgages all averaged 0.6 point.
A year ago, the nationwide average rate on 30-year mortgages stood at 6.40 percent, 15-year mortgage rates averaged 6.06 percent, five-year adjustable-rate mortgages were at 6.12 percent, and one-year adjustable-rate mortgages stood at 5.73 percent.
