Industry News

Fed pauses, mortgage rates dive

Adjustable-loan borrowers may rush refi market

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Mortgage rates dropped for the third consecutive week after the release of a disappointing labor market report and the Federal Reserve's subsequent decision to discontinue its interest-rate hikes, according to surveys conducted by Freddie Mac and Bankrate.com. In Freddie Mac's survey, the 30-year fixed-rate mortgage fell to an average 6.55 percent this week, down from last week's average of 6.63 percent. The average for the 15-year fixed-rate mortgage also sank from last week, falling from 6.27 percent to 6.2 percent. Points, which are fees charged by lenders for loan processing expressed as a percent of the loan, averaged 0.4 on the 30- and 15-year loans. The five-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) averaged 6.21 percent this week, with an average 0.4 point, down from last week when it averaged 6.27 percent. The one-year Treasury-indexed ARM average remained at 5.69 percent, with an average 0.8 point. "The weaker-than-expected jobs report combined with the Fe...