Mortgage interest rates dropped for the third consecutive time this week. This drop pushed mortgage interest rates for traditional 30 year mortgages to lowest point since early April. According to a survey of national mortgage lenders the 30 year fixed rate mortgage dropped to 6.55% this week, down from 6.6% the previous week.
Last April mortgage interest rates averaged 6.53 percent; these interest rates have been on the rise to a four year high in July of 6.8%. Mortgage analysts stated this drop can be attributed to a slowdown in the economy. This slowdown eases inflationary pressure on interest rates. Last week the Federal Reserve decided not to raise short term interest rates, a temporary pause in the two year campaign it is waging against inflation.
The news from the Federal Reserve coupled with a weak job report contributed to the decline in mortgage interest rates this week. The sale of homes has declined as interest rates have been rising; many homeowners are using this dip in interest rates to refinance adjustable rate mortgages before the Federal Reserve is expected to resume raising interest rates next month.
Interest rates for 15 year mortgages average 6.2% this week; this is down from 6.27% the previous week. One year Adjustable Rate Mortgages (ARM) remain unchanged this week at 5.69%. Five year ARM loans dropped to 6.21%; this interest rate was 6.7% the previous week.
One year ago, a traditional fixed interest rate mortgage averaged 5.89%, a 15 year fixed rate mortgage averaged 5.47%, and the one and five year Adjustable Rate Mortgage averaged 4.5% and 5.4%.
You can learn more about your mortgage options, including common homebuyer mistakes to avoid, by registering for our free mortgage guidebook: “Five Things You Need to Know before Refinancing Your Mortgage.”