Mortgage Rates Drop Slightly
Nov. 07, 2002
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WASHINGTON (AP) _ Mortgage rates around the country fell for the second straight week, Freddie Mac reported Thursday in its nationwide survey.
The average interest rate on 30-year fixed-rate mortgages dipped to 6.11 percent this week from 6.13 percent last week.
This week's rate was the lowest since the week ending Oct. 11 when rates on the 30-year mortgage dropped to 5.98 percent, the lowest level since Freddie Mac began tracking them in 1971. That marked the sixth time this year that 30-year rates hit a new low.
Analysts predicted that rates should go lower following the decision by the Federal Reserve on Wednesday to cut a key interest rate by a surprisingly large half-point.
``Anticipation of a (quarter-point) rate cut pushed mortgage rates downward in this week's survey and we expect to see further downward drifts over the coming week or so as the market moves on the actual larger rate cut,'' said Frank Nothaft, Freddie Mac's chief economist.
Low mortgage rates this year have been feeding a refinancing boom. The extra monthly cash consumers are saving by refinancing their mortgages at lower interest rates is helping to support consumer spending. Home sales are expected to post records this year.
Rates for 15-year fixed-rate mortgages, a popular option or refinancing, also dropped this week to 5.48 percent, down from last week's 5.51 percent.
For one-year adjustable-rate mortgages, rates dipped to 4.15 percent, compared with 4.25 percent last week.
This week's mortgage rates do not include add-on fees known as points. The loans carried an average fee of 0.6 point for the 30-year and 15-year mortgages and 0.7 point for the one-year ARMs.
A year ago, 30-year mortgages averaged 6.45 percent, 15-year mortgages were 5.94 percent and one-year ARMS stood at 4.25 percent.
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