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The Honolulu Advertiser

Posted on: Friday, May 27, 2005

30-year mortgage rates drop again

By Martin Crutsinger
Associated Press

WASHINGTON — Rates on 30-year mortgages declined for the seventh time in the past eight weeks, a downward trend that has helped push sales of both new and existing homes to record levels.

Mortgage giant Freddie Mac reported yesterday in its weekly survey that rates on 30-year, fixed-rate mortgages averaged 5.65 percent, down from 5.71 percent last week.

It was the seventh decline in the past eight weeks and pushed the 30-year mortgage down to the lowest level since mid-February.

The steady decline in mortgage rates over the past two months has helped spur housing sales to record levels and prompted some economists to revise their forecasts. Many now believe if mortgage rates rise only gradually for the rest of the year that sales of both new and existing homes could surpass last year's levels, which would mean the fifth straight year new sales records have been set.

For 15-year, fixed-rate mortgages, a popular option for refinancing, rates dipped to 5.21 percent this week, down from 5.27 percent last week. Rates on one-year adjustable rate mortgages declined to 4.21 percent, down from 4.26 percent last week.

Rates on five-year hybrid adjustable rate mortgages were unchanged at 5.07 percent.