30-Year Mortgage Rates Drop Below 5%
Rates on 30-year home loans dropped below 5
percent for the first time in four months, but still remained above
this year's record low, Freddie Mac said Thursday.
The average rate on a 30-year fixed
mortgage was 4.94 percent, down from 5.04 percent last week, Freddie
Mac said. The last time the 30-year home loan averaged less than 5
percent was the week ending May 28, when it was 4.91 percent.
Rates
hit a record low of 4.78 percent hit in the spring, and remain
appealing for people interested in buying a home or refinancing.
On Thursday, the National Association of
Realtors said the number of signed sales contracts rose for the seventh
straight month in August, as homebuyers rushed to take advantage of a
tax credit for first-time owners that expires in November.
"Low mortgage rates are helping to stabilize home sales," said Frank Nothaft, Freddie Mac's chief economist.
But
borrowers may want to consider the Federal Reserve's announcement last
week that it is slowing down a program intended to lower mortgage rates
and boost the housing market. Analysts say mortgage rates should remain
low for now but could eventually move higher, and homeowners who want
to refinance mortgages shouldn't delay.
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 mortgage fell to 4.36 percent from 4.46
percent last week, according to Freddie Mac. This week's rate on 15-year mortgages was the lowest since Freddie Mac started tracking it in 1991.
Rates
on five-year, adjustable-rate mortgages averaged 4.42 percent, down
from 4.51 percent a week earlier. Rates on one-year, adjustable-rate
mortgages fell to 4.49 percent from 4.52 percent last week.
The rates do not include add-on fees known as points. The nationwide fee for loans in Freddie Mac's
survey averaged 0.7 point for 30-year mortgages, and 0.6 point for
15-year and five-year loans. The fee averaged 0.5 point for one-year
mortgages.