Mortgage rates edged down again this week, posting their third consecutive decline with 5-year adjustable-rate mortgages (ARMs) falling to a new record low in the weekly Freddie Mac rate survey.
Average interest rates for all three major loan types - 30-year fixed-rate, 15-year fixed-rate and 5-year ARMs declined for the third week in a row, though the change was small. However, a two-point decline on 5-year ARMs, to 2.60 percent, put them just barely at a new all-time low, exceeding the previous low of 2.61 percent last reached the week of March 21, by a single basis point.
15-year rates just miss record
Fixed-rate 15-year mortgages just missed a record low, dropping to 2.64 percent, down only a single point from last week's average but within a hair of their all-time low of 2.63 percent, reached the week of Nov. 21, 2012 in the Freddie Mac survey.
Meanwhile average rates on 30-year fixed-rate mortgages were down to 3.41 percent, from 3.43 percent last week. That puts them back within one-tenth of a percentage point of their all-time low of 3.31 percent, also reached the week of Nov. 21.
Frank Nothaft, Freddie Mac chief economist, attributed the downturn to recent signs of weakening consumer spending. The Census Bureau reported that retail sales fell in March for the second time in three months, down 0.4 percent, while the University of Michigan index of consumer sentiment fell 6.3 points in April to 72.3, its lowest reading since last July and interrupting a streak of three consecutive monthly gains
Rates are based on mortgages purchased or guaranteed by Freddie Mac with an 80 percent loan-to-value ratio or better.