Mortgage Rates Drop; 5/1 ARM at 8-Year Low

Before you go, we thought you'd like these...
Before you go close icon

Freddie Mac released its weekly update on national mortgage rates this morning, showing a continued slide in rates nearly across the board. Rates remain near record lows.

Thirty-year fixed-rate mortgages (FRM) dropped another two basis points on top of the 11-basis-point slide of the previous week, and now stand at 3.41%. (Last year at this time, the average rate was 3.9%.) Shorter-term 15-year FRMs shed a single basis point, falling to 2.64%, which is where they started the year. (Last year at this time, the average rate was 3.13%.)

Variable-rate mortgages, in contrast, took different paths. One-year ARMs gained back the single basis point they lost last week, and are now back at 2.63%. 5/1 ARMs, however, fell two basis points to 2.60%. Freddie Mac says that's the lowest that rate has been since it began tracking in 2005. 


Commenting on the numbers, Freddie Mac Vice President and Chief Economist Frank Nothaft linked continuing low mortgage rates to weak consumer spending in general, and continued negativism among consumers. "Retail sales contracted for the second time in three months, falling 0.4 percent in March," he is quoted as saying. "In addition, the University of Michigan reported their Consumer Sentiment Index dropped 6.3 points in April to settle at 72.3, its lowest level since July. The April reading snapped a streak of three consecutive gains."

link

The article Mortgage Rates Drop; 5/1 ARM at 8-Year Low originally appeared on Fool.com.

Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

Copyright © 1995 - 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.

Read Full Story

Want more news like this?

Sign up for Finance Report by AOL and get everything from business news to personal finance tips delivered directly to your inbox daily!

Subscribe to our other newsletters

Emails may offer personalized content or ads. Learn more. You may unsubscribe any time.

From Our Partners