30-year rate for mortgages falls to 5.79%

By Martin Crutsinger
Associated Press

WASHINGTON — Rates on 30-year mortgages fell for a second straight week while other mortgage rates held steady this week.

The average interest rate on a fixed-rate 30-year mortgage dipped to 5.79 percent, Freddie Mac, the mortgage company, reported yesterday in its weekly nationwide survey. This week's rate was down from 5.82 percent last week.

In the week ending March 14, just before the United States went to war against Iraq, rates on 30-year mortgages declined to a record low of 5.61 percent as investors sought the safe haven of bonds during a period of heightened global tensions.

That rate was the lowest since Freddie Mac began tracking 30-year mortgages in 1971. Other records indicate that the rate is the lowest since the early 1960s.

Many economists believe interest rates will stay low for some months to come until economic growth rebounds to a faster rate.

"A tepid national economy has anchored mortgage rates to current low levels so far this year," said Frank Nothaft, Freddie Mac's chief economist. "According to the Federal Reserve's beige book, the housing industry is the only bright spot in the economy right now."

For 15-year fixed-rate mortgages, a popular option for refinancing, rates remained unchanged this week at 5.12 percent, down from a level of 5.17 percent two weeks ago.

Rates for one-year adjustable mortgages were also unchanged this week at 3.79 percent, down from a level two weeks ago of 3.80 percent.

This week's mortgage rates do not include add-on fees known as points. Each loan type carried an average fee of 0.6 point this week.

A year ago, rates on 30-year mortgages averaged 6.88 percent, 15-year mortgages were 6.35 percent and one-year adjustable mortgages stood at 4.91 percent.