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30-year mortgage rates average 5.87%

Interest rates on U.S. 30-year fixed-rate mortgages held under 6 percent for a fifth straight week, mortgage finance company Freddie Mac said on Thursday.
30-year fixed mortgage rates chart
/ Source: Reuters

Interest rates on U.S. 30-year fixed-rate mortgages held under 6 percent for a fifth straight week, mortgage finance company Freddie Mac said on Thursday.

Freddie Mac said U.S. 30-year mortgage rates stood at an average of 5.87 percent this week, up slightly from 5.85 percent last week.

Fifteen-year mortgages averaged 5.17 percent compared with 5.15 percent last week, while one-year adjustable rate mortgages averaged 3.76 percent, up slightly from 3.72 percent.

A year ago, 30-year mortgages averaged 5.95 percent, 15-year mortgages 5.33 percent and the one-year ARM 4.03 percent.

"With mortgage rates expected to remain around current modest levels, housing activity will continue to be brisk in 2004," said Frank Nothaft, Freddie Mac chief economist, in a statement.

The Mortgage Bankers Association on Wednesday said its widely watched measure of demand for home loans, the purchase index, rose 2.9 percent to 401.3 last week.

While overall mortgage loan applications fell from a year ago in large part because of a precipitous drop in refinancings, applications to buy a home rose more than 6 percent from a year ago, the MBA, a mortgage banking industry trade group, said.

"Although home starts and sales will slip a little this year from last year, we should still experience construction and sales volumes that exceed 2002's levels, which was a great year for housing," Nothaft said.

The total 2003 housing picture will be available later this month in several U.S. December housing indicators. The Commerce Department releases housing starts on Jan. 21 and new home sales on Jan. 28. The National Association of Realtors issues existing home sales data on Jan. 26.

Freddie Mac said lenders charged an average of 0.7 percent in fees and points on 30- and 15-year mortgages, both unchanged from last week. They charged 0.6 percent on the ARM, down from 0.7 percent.

Freddie Mac is a mortgage finance company chartered by Congress that buys mortgages from lenders and packages them into securities for investors or holds them in its own portfolio.