Rates Fall Slightly During Week

Indications that economic growth is moderating eased the pressure on mortgage rates, as the national average commitment rate on 30-year, fixed-rate mortgages fell to 6.72 percent for the week ending July 27, down from last week's average of 6.8 percent but still up from 5.77 percent a year ago, according to Freddie Mac.

The national average commitment rate for 15-year, fixed-rate mortgages was 6.34 percent, down from the previous week’s average of 6.41 percent. A year ago, the 15-year fixed-rate average was 5.34 percent."

Mortgage rates drifted lower this week on indications that economic growth is moderating, inflation remains under control, and the [Federal Reserve Board] just may pause raising rates for awhile," says Frank Nothaft, Freddie Mac vice president and chief economist."Meanwhile, recently released new homes sales for June fell to a lower than expected rate. That drop can be traced directly to higher mortgage rates, which are also helping to slow the growth of house prices in 2006," he adds.

The average for five-year adjustable-rate mortgages was 6.35 percent, compared with 6.36 percent the previous week and 5.27 percent a year earlier. One-year ARMs averaged 5.78 percent this week, down from 5.8 percent a week ago. The average rate on one-year ARMs was 4.46 percent for the same period the previous year. The national average commitment rate, along with fees and points charged by lenders, reflects the cost of obtaining the mortgage.

—REALTOR® Magazine Online