30-YEAR RATE HITS 6-MONTH LOW POINT MORTGAGE LOANS STILL SURPRISINGLY CHEAP.Byline: Gregory J. Wilcox Staff Writer Two key mortgage rates sank to their lowest level in six months this week amid mixed economic signals, Freddie Mac Freddie Mac: see Federal Home Loan Mortgage Corporation. said Thursday. The rate on the benchmark 30-year loan slipped to 5.69 percent from 5.74 percent in last week's survey, the McLean, Va.-based mortgage giant said. A year ago the rate averaged 6.05 percent. The 15-year fixed rate also fell, averaging 5.07 percent for the week ending Thursday. Last week it averaged 5.14 percent and a year ago it was 5.36 percent. It's a little surprising that rates are still this low this deep into the year. At the beginning of the year, Frank Nothaft, Freddie Mac's chief economist The Chief Economist is a single position job class having primary responsibility for the development, coordination, and production of economic and financial analysis. It is distinguished from the other economist positions by the broader scope of responsibility encompassing the , expected rates around 6 percent. ``Long-term rates are a lot lower than we would have thought a year ago,'' he said. ``That reflects in part that economic growth has been a little bit weaker than many of us thought.'' The year's high mark for the 30-year rate, 6.34 percent, came the week of May 13. The 15-year rate is the lowest since early April. The trend since then has been mostly down as inflation remains modest and the economic picture muddled mud·dle v. mud·dled, mud·dling, mud·dles v.tr. 1. To make turbid or muddy. 2. To mix confusedly; jumble. 3. To confuse or befuddle (the mind), as with alcohol. . Rates have been bouncing around within a 20-basis-point range for weeks. A basis point is 1/100th of a percent. ``We've been kind of drifting sideways drifting sideways the patient moves gradually to one side when attempting to walk in a straight line. since back in August. There are all kinds of weird dynamics going on out there right now,'' said Keith T. Gumbinger, vice president of HSH HSH abbr. Her (or His) Serene Highness Associates, the nation's biggest tracker of mortgage data. Freddie Mac's survey followed by a day one by the Mortgage Bankers Mortgage Banker A company, individual or institution that originates, sells and services mortgage loans. Notes: Don't confuse a mortgage banker with a mortgage broker. Association that showed a similar trend. It had the interest rate for 30-year loan falling to 5.64 percent from 5.69 percent one week earlier. Its average for a 15-year fixed-rate mortgage decreased to 5.03 percent from 5.06 percent one week earlier. The low rates did stimulate the housing market. The index measuring purchase activity increased 5.8 percent in the latest survey and the one tracking refinance Refinance 1. When a business or person revises their payment schedule for repaying debt. 2. Replacing an older loan with a new loan offering better terms. Notes: When a business refinances they typically extend the maturity date. activity increased by 10.6 percent, both on a weekly basis. Gregory J. Wilcox, (818) 713-3743 greg.wilcox(at)dailynews.com |
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