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Mortgage rates retreat
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August 23, 2001: 1:26 p.m. ET
Short-term rates dip lower in reaction to latest Fed rate cut
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NEW YORK (CNNfn) - Mortgage rates edged lower after this week's seventh interest-rate cut of 2001 by the Federal Reserve.
According to Freddie Mac, the benchmark 30-year fixed-rate mortgage was at 6.91 percent for the week ending Aug. 24, inching down from 6.92 percent the previous week, and at its lowest level since the week ended March 23, when it averaged 6.89 percent. A year ago, the same rate stood at 7.99 percent.
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The average this week for the 15-year fixed-rate mortgage was 6.47 percent, down from last week's average of 6.48 percent. A year ago, the same rate stood at 7.72 percent.
One-year adjustable-rate mortgages (ARMs) averaged 5.68 percent, down from last week's average of 5.71 percent. The same mortgage averaged 7.37 percent at this time last year.
"Long-term mortgage rates are almost unchanged this week because the market had already built in the anticipated rate cut by the Federal Reserve. The shorter-term 1-year ARM , however, did respond to the Fed's rate cut by dropping a little last week," said Robert Van Order, Freddie Mac chief economist.
[Click here for a breakdown of U.S. mortgage rates by region]
Freddie Mac (FRE: Research, Estimates), or Federal Home Mortgage Corp., is a publicly traded company 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. 
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