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The Honolulu Advertiser
Posted on: Friday, September 15, 2006

Mortgage rates still going down

 •  Hawai'i Real Estate Report

By Martin Crutsinger
Associated Press

WASHINGTON Rates on 30-year mortgages fell for the seventh time in the past eight weeks, dropping to the lowest level since early April.

Mortgage giant Freddie Mac said yesterday that 30-year fixed-rate mortgages dipped to 6.43 percent this week, down from 6.47 percent last week.

Rates on 30-year mortgages had hit a four-year high of 6.80 percent on July 20 before beginning the sustained slide.

Investors have become more convinced in recent weeks that a drop in oil prices will keep inflation under control and allow the Federal Reserve to keep interest rates steady.

The Fed meets next week amid widespread expectations that policymakers will leave rates unchanged for a second straight meeting following a string of 17 consecutive rate hikes over two years.

Frank Nothaft, chief economist at Freddie Mac, said he expected mortgage rates to stay around current levels as long as inflation remains under control.

Rates on other types of mortgages declined as well this week. Rates on 15-year fixed-rate mortgages, a popular choice for refinancing, averaged 6.11 percent, down from 6.16 percent last week.

For one-year adjustable-rate mortgages, rates dipped to 5.60 percent, down from 5.63 percent last week.

Rates on five-year adjustable-rate mortgages fell to 6.10 percent this week, compared to 6.14 percent last week.

The mortgage rates do not include add-on fees known as points. Thirty-year mortgages carried a nationwide average fee of 0.5 point while 15-year mortgages had a fee of 0.4 point. One-year ARMS carried a fee of 0.7 point and five-year ARMs had a fee of 0.6 point.