rebuild.org finance news:

Back to Latest News Headlines

30-Year Mortgage Rates Head Downward

[Sep 27, 2007.]


Homeowners received some encouraging news this week, thanks to an item from the mortgage company known as Freddie Mac.

Freddie Mac reports that 30-year mortgage rates have declined to their lowest level in some three months.

The fixed-rate mortgage rate now averages 6.45%. That's a decline from the 6.52% rate the previous week. It's also the lowest rate since the end of May, when rates bottomed out at 6.42%.

The news is certainly encouraging for homebuyers, who are often finding it difficult to secure loans. That's because financial institutions are invoking stricter borrowing standards because of the increasing default rate.

Meanwhile, the rates on other mortgages appear to vary.

For instance, the rates for 15-year, fixed-rate mortgages are averaging 6.12%. That's a decrease from the previous week's rate of 6.18%. Rates on 5-year adjustable-rate mortgages increased to 6.35%, up from 6.34% the week before. One-year adjustable-rate mortgages experienced a hefty jump in rates, rising to 5.84% from 5.60% the week before.

The decrease in the rates for 30-year mortgages is being attributed to the Federal Reserve's decision to cut its discount rate. That rate refers to the interest charged to make loans to banks. Observers predict the Fed will also reduce its federal funds rate fund. The fund plays a significant role in both consumer and business loans.  At this time last year, the 30-year mortgage rate was 6.44%, while the 15-year mortgage rate was 6.14%. The five-year adjustable rate mortgage was 6.11%; the one-year adjustable rate mortgage was 5.59%.

Housing sales plummeted last year, following a five-year period of growth. The housing market is also feeling the effects of the collapse of the subprime loan industry. Subprime loans are those loans which are given to homebuyers who have troubled histories and who do not qualify for other types of loans.

Julie Ann Amos
September 27th 2007

Recent News

  • National Economic Picture Brightens
    The U.S. economic picture brightened this past spring, thanks to an expansion in the gross domestic product. Still, the national housing crisis and problems within the credit card industry mean there continue to be clouds on the horizon.[19th September 2007]

  • President Tries to Help Homeowners Avoid Default
    President George W. Bush is taking action to try to prevent homeowners who took out subprime mortgages from going into default. [19th September 2007]

  • Study Demonstrates Popularity of Check Cards
    A survey by Bankrate demonstrates just how much American consumers are benefiting from debit cards. [19th September 2007]

  • Specter of Recession Looms in the U.S.
    The specter of recession is rising in the U.S., buoyed by the tidalwave of troubles in the stock market and housing sector. [19th September 2007]

  • Fall is the Time for Re-evaluating Credit Card Options
    With fall just around the corner, many people—especially college-age people—may be re-evaluating their credit card options. This year, there are an endless number of possibilities for those seeking to expand their credit horizons [17th September 2007]

  • Barclays Credit Business Reaches Milestone
    Barclays has become the fastest-growing credit card issuer in the U.S., based on figures just released by the company.[17th September 2007]

  • Foreclosures in the U.S. on the Rise Again
    The number of individuals forced into home foreclosure is rising. Statistics show that the foreclosure rate jumped 9% in July over the previous month's totals. When compared with last year, the foreclosure rate is up an astounding 93%. [17th September 2007]


news subscription:

Easily subscribe to the rebuild.org news feed.

Read our news without even visiting our site!

Subscribe to our news


news archive:

Rebuild.org monthly news archive