Flagging Economy Continues To Keep Mortgage Rates Low
November 8, 2002
1-Year ARM Lowest Since 1994
McLEAN, VA -- In Freddie Mac's Primary Mortgage Market Survey, the 30-year fixed-rate mortgage (FRM) averaged 6.11 percent, with an average 0.6 point, for the week ending November 8, 2002, slipping from 6.13 percent last week. Last year at this time, the 30-year FRM averaged 6.45 percent.
The average for the 15-year FRM this week is 5.48 percent, with an average 0.6 point, down from last week's average of 5.51 percent. A year ago, the 15-year FRM averaged 5.94 percent.
One-year Treasury-indexed adjustable-rate mortgages (ARMs) averaged 4.15 percent this week, with an average 0.7 point, down from last week's average of 4.25 percent. This time last year, the one-year ARM averaged 5.30 percent. The one-year ARM has not been lower since the week ending February 4, 1994 when it was 4.12 percent.
(Average commitment rates should be reported along with average fees and points to reflect the total cost of obtaining the mortgage.)
"Recent economic indicators show a lackluster economic climate," said Frank Nothaft, Freddie Mac chief economist. "And that led to the surprise 50-basis point rate cut by the Fed yesterday.
"Anticipation of a 25-basis 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 itself."
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Source: Freddie Mac