|
Mortgage rates crawl up
|
 |
August 24, 2000: 1:58 p.m. ET
Market predicts Fed's non-action; long-term/short-term rate gap widens
|
NEW YORK (CNNfn) - Mortgage rates were fairly level this week, creeping up slightly, as the market correctly anticipated no action by the Fed, according to a report released by Freddie Mac. But a wider leap in short-term rates increased the spread between such rates and 30-year fixed rate mortgages.
A 30-year fixed rate mortgage (FRM) averaged 7.99 percent for the week ending Aug. 25, almost unchanged from 7.96 a week earlier. The same mortgage was 7.80 percent a year earlier.
The average for a fixed-rate 15-year mortgage was 7.72 percent, edging up from last week's average of 7.70 percent. Last August, the rate was 7.43 percent.
 A one-year adjustable-rate mortgage (ARM) averaged 7.37 percent up from last week's average of 7.21 percent. The same mortgage averaged 6.22 percent a year ago.
[Click here to see a breakdown of U.S. mortgage rates by region.]
"Fixed-rate mortgage rates were fairly flat this week. This stability is based in part on the fact that the market anticipated the Fed would take no action and it didn't," said Robert Van Order, chief economist for Freddie Mac. "However, the Fed did indicate that it is diligently watching for signs of inflation, even as the economy appears to be slowing to a less frenetic pace.
Van Order said the information in the existing home sales and Gross Domestic Product reports due out on Friday will "help confirm or deny a slowdown in the overall economy of the nation and will influence the future direction of interest rates."
Freddie Mac (FRE: Research, Estimates), or Federal Home Mortgage Corp., is a publicly traded company that the government established in 1970 to provide a flow of funds to mortgage lenders.
It buys mortgages from banks, bundles them, and then resells them as mortgage-backed securities. Its products, and the products of other similar entities, have become increasingly popular as an alternative to government-backed bonds, particularly with international investors. 
|
|
|
|
|
 |
|
