Mtge Rates Fall This Week, 15-Year Fixed Below 5% -Freddie Mac

   DOW JONES NEWSWIRES 
 

Mortgage rates fell this week, with the average rate on 15-year fixed-rate mortgages dropping back below 5%, according to Freddie Mac's (FRE) weekly survey of mortgage rates released Thursday.

Mortgage rates spiked in recent weeks, reversing a months-long downtrend, as Treasurys slumped in price amid worries of the flood of supply being sold by the federal government to finance its ballooning deficit.

Treasurys have rebounded somewhat in recent days, with Freddie chief economist Frank Nothaft saying benign inflation figures helped reverse the upward trend for mortgage rates this week.

The 30-year fixed-rate mortgage averaged 5.38% for the week ended Thursday, down from last week's 5.59% average and 6.42% a year ago. Rates on 15-year fixed-rate mortgages were 4.89%, down from 5.06% and 6.02%, respectively.

Five-year Treasury-indexed hybrid adjustable-rate mortgages averaged 4.97%, down from 5.17% last week and well below their 5.89% average a year ago. One-year Treasury-indexed ARMs were 4.95%, down from 5.04% and 5.19%, respectively.

To obtain the rates, the fixed-rate mortgages required payment of an average 0.7 point and the ARMs required an average 0.6 point. A point is 1% of the mortgage amount, charged as prepaid interest.

-By Kerry E. Grace, Dow Jones Newswires; 201-938-5089; [e-mail]