WASHINGTON – Rates on benchmark 30-year mortgages held steady at a seven-month low this week, while rates for other types of mortgages were mixed.
The average rate on 30-year, fixed-rate mortgages was 5.58 percent, unchanged from the previous week, which had marked the lowest rate since 5.52 percent for the week ending July 11, Freddie Mac, the mortgage giant, reported Thursday in its weekly nationwide survey of mortgage rates.
Rates on 30-year mortgages sank to 5.21 percent in the middle of June, the lowest level in more than four decades. Since then rates have bounced up and down.
For 15-year, fixed-rate mortgages, a popular option for refinancing, rates rose to 4.89 percent this week, up from 4.87 percent last week.
Rates for one-year adjustable mortgages, meanwhile, decreased to 3.50 percent, compared with 3.53 percent last week.
“There was very little movement either way this week,” said Frank Nothaft, Freddie Mac’s chief economist. “And it looks like consumers are taking advantage of the low level of mortgage rates as applications for home purchases and refinancing are up for the last two weeks.”
The Mortgage Bankers Association said its gauge tracking mortgage loan applications for home purchases and refinancings increased by 2.1 percent last week from the previous week.
Federal Reserve Chairman Alan Greenspan earlier this week questioned consumers’ preference for fixed-rate mortgage loans.
“American homeowners clearly like the certainty of fixed-mortgage payments,” he said. That stands in sharp contrast with homeowners in other countries, who prefer adjustable-rate mortgages, he noted.
“American consumers might benefit if lenders provided greater mortgage product alternatives to the traditional fixed-rate mortgage,” Greenspan said.
“To the degree that households are driven by fears of payment shocks but are willing to manage their own interest rate risks, the traditional fixed-rate mortgage may be an expensive method of financing a home,” he said.
A year ago, rates on 30-year mortgages averaged 5.79 percent, 15-year mortgages were 5.14 percent and one-year adjustable mortgages stood at 3.83 percent.
The nationwide averages for mortgage rates do not include add-on fees known as points. Each loan type carried an average fee of 0.7 point this week.
A class for home buyers will be 6:30-
9 p.m. Monday and Thursday in the auditorium at the Everett Public Library, 2702 Hoyt Ave. in Everett. The free five-hour program is presented by Renita Williams of the Washington State Housing Commission. For information, call 800-526-8316, ext. 4831, or send an e-mail to RenWilliams@here4you.com.