If you're new here, you may want to subscribe to my RSS feed. Thanks for visiting!
Mortgage interest rates dropped as fears of inflation eased. Adjustable rate mortgages were helped the most. The Fed’s aggressive posture and track record for action (i.e. Bear Stearns, liquidity injections, rate cuts), and led by stability of the dollar and tamer-than-expected inflation data all helped the cause.
From Market Watch on mortgage rates:
The 30-year fixed-rate mortgage averaged 6.01% for the week ending May 15, down from last week’s 6.05% average, according to Freddie Mac’s weekly survey. The mortgage averaged 6.15% a year ago.
Five-year Treasury-indexed hybrid adjustable-rate mortgages averaged 5.57% this week, down from 5.67% last week. The ARM averaged 5.89% a year ago. And 1-year Treasury-indexed ARMs averaged 5.18% this week, down from last week’s 5.29% average. The ARM averaged 5.48% a year ago.To obtain the rates, the 30-year fixed-rate mortgage and the 5-year ARM required payment of an average 0.6 point. The 15-year fixed-rate mortgage required an average 0.5 point and the 1-year ARM required an average 0.7 point. A point is 1% of the mortgage amount, charged as prepaid interest.“Fed Chairman Bernanke indicated in a speech on May 13 that the Fed stands ready to continue to add liquidity to the markets,” Nothaft said in a news release. “On the same day, San Francisco Fed bank president Janet Yellen added that she anticipates inflation will slow as commodity prices level off in the second half of the year.”
