Home Buyers get a break as U.S. Mortgages Rates Fall

Would-be home buyers caught a break this week as rates for 30-year home loans fell back after soaring to the highest level in seven months.  According to Freddie Mac (NYSE:MAC) the average rate for a 30-year fixed mortgage was 5.38% this week, down from 5.59% a week earlier.  However Freddie Mac shares can't get above 70 Cents, gotta love U.S. Government intervention.

Data released Wednesday suggested that inflation remains largely in check, and the yield on the 10-year Treasury note has fallen back from an 8-month high of 4.01 percent reached last week.

Though there are signs that the troubled U.S. housing market is beginning to stabilize, higher rates could threaten or slow down any recovery, since borrowers would be able to borrow less money and might decide to hold off on their purchases.

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Freddie Mac collects mortgage rates on Monday through Wednesday of each week from lenders around the country. Rates often fluctuate significantly, even within a given day.

The average rate on a 15-year fixed-rate mortgage fell to 4.89 percent, down from 5.06 percent last week, according to Freddie Mac.

Rates on five-year, adjustable-rate mortgages averaged 4.97 percent, down from 5.17 percent last week. Rates on one-year, adjustable-rate mortgages fell to 4.95 percent from 5.04 percent.

The rates do not include add-on fees known as points. The nationwide fee averaged 0.7 point last week for 30-year and 15-year mortgages. Fees averaged 0.6 point for five-year and one-year adjustable rate loans.

SOURCE: http://www.businessweek.com/ap/financialnews/D98T6PO80.htm