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Mortgage rates take a dip
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April 13, 2000: 2:03 p.m. ET
Long-term rates down, short-term rates up as economic charge continues
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NEW YORK (CNNfn) - Long-term mortgage rates have eased, and short-term adjustable rates have risen, as home ownership demand continues to both reflect and contribute to the continuing robust economy, according to a survey released by Freddie Mac Thursday.
The average rate on a 30-year fixed-rate mortgage was 8.12 percent for the week ending April 14, down from 8.20 percent a week earlier.
A year ago, the same mortgage stood at 6.87 percent.
The average for a 15-year fixed-rate mortgage stood at 7.76 percent, down from 7.83 percent the previous week. Twelve months ago the same rate averaged 6.47 percent.
 A one-year adjustable rate mortgage (ARM) averaged 6.86 percent, up from 6.79 percent a week earlier, the highest level in four years. For the week ending January 13, 1995 the rate was 6.87 percent.
The same mortgage averaged 5.56 percent a year ago.
"The Producer Price Index (PPI) figures released today show an overall increase of 0.6 percent, but the core rose only a very modest 0.1 percent, indicating the actual rate of inflation is still very low," said Frank Nothaft, deputy chief economist for Freddie Mac. "This good news points to a continuation of current affordable mortgage rates in the coming months."
[Click here to see a breakdown of U.S. mortgage rates by region.]
Nothaft said and exception to the trend might be the 1-year adjustable rate mortgage.
It "has continued to creep up over time in reaction to the Fed's moves," said Nothaft. "The difference between the 30-year FRM and the 1-year ARM is only about 1-1/4 percent, the narrowest it has been since March of 1999, making the 30-year FRM more attractive."
Freddie Mac (FRE: Research, Estimates), or the Federal Home Mortgage Corp., is a publicly traded company the government set up in 1970 to provide a flow of funds to mortgage lenders.
It buys mortgages from banks, bundles them, and then sells them as mortgage-backed securities. Its products and the products of other similar agencies have become increasingly popular as an alternative to government-backed bonds, particularly with international investors. 
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