Mortgage rates dip below 6%

Interest rates on longer-term fixed- and adjustable-rate mortgages fell for the first time in three weeks, as investors fled to the relative safety of bond markets, Freddie Mac reported in its weekly mortgage market survey.

Rates on 30-year fixed-rate mortgages averaged 5.94 percent with an average of 0.6 point for the week ending Oct. 9, down from 6.1 percent the previous week and 6.4 percent a year ago.

Rates for 15-year fixed-rate mortgages averaged 5.63 percent with an average 0.6 point, down from 5.78 percent a week ago and 6.06 percent a year ago.

Five-year Treasury-indexed hybrid adjustable-rate mortgages (ARMs) averaged 5.90 percent with an average 0.6 point, down from 6.00 percent the previous week and 6.12 percent a year ago.

One-year Treasury-indexed ARMs averaged 5.15 percent this week with an average 0.6 point, up from 5.12 percent last week but down from 5.73 percent a year ago.

"Longer-term mortgage rates fell for the first time in three weeks, roughly following bond market yields," said Frank Nothaft, Freddie Mac chief economist. "Meanwhile, the latest housing market data showed some pickup in home purchase activity in August. Pending existing home sales in August rose 7.4 percent, reflecting the largest monthly increase since October 2001, and July's figures had an upward revision, according to the National Association of Realtors."

More recently, mortgage applications for both home purchases and refinancing grew slightly over the week ending Oct. 3, reversing a two-week decline, Nothaft said, citing figures from the Mortgage Bankers Association.

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