Mortgage interest rates this week fell to lows not seen since July, as job market woes and the declining dollar highlighted the vulnerability of the U.S. economy, according to surveys conducted by mortgage buyer Freddie Mac and Bankrate.

In Freddie Mac’s weekly survey, the 30-year fixed-rate mortgage averaged 5.58 percent for the week ended today, down from 5.66 percent last week. This is the lowest the 30-year fixed-rate mortgage has been since the week ending July 11, 2003, when it was 5.52 percent.

The average for the 15-year fixed-rate mortgage this week is 4.87 percent, down from last week’s average of 4.96 percent. This is the lowest the 15-year fixed-rate mortgage has been since the week ending July 11, 2003, when it was 4.85 percent. Points on both the 30- and 15-year averaged 0.6.

One-year Treasury-indexed adjustable-rate mortgages averaged 3.53 percent this week, with an average 0.6 point, down from 3.57 percent last week. This is the lowest the one-year ARM has been since the week ending July 4, 2003, when it averaged 3.49 percent.

“Mortgage rates this week are at seven-month lows and teetering on the 45-year-low levels of last summer,” said Frank Nothaft, Freddie Mac chief economist. “There continues to be no sign of inflation on the horizon and, as a matter of fact, core inflation is at a generational low.

After several weeks at a virtual standstill, mortgage rates have tumbled to a seven-month low. The average 30-year fixed-rate mortgage fell from 5.71 percent to 5.58 percent, according to’s weekly national survey of large lenders.

The average 30-year fixed mortgage rate is now the lowest since July 2, 2003. The mortgages in this week’s survey had an average of 0.35 discount and origination points.

The 15-year fixed-rate mortgage popular for refinancing dropped by a similar amount, from 5.02 percent to 4.91 percent. The jumbo 30-year fixed-rate mortgage sank 14 basis points to 5.78 percent, while the one-year adjustable-rate mortgage fell 10 basis points to a record low of 3.6 percent. A basis point is one one-hundredth of one percentage point.

Mortgage rates moved lower over the past week in response to several factors. Among them were: Alan Greenspan’s Congressional testimony that repeated the Fed’s intent to keep interest rates low; prevailing uncertainty in the job market; and continued purchases of Treasury securities by foreign central banks amid the dollar’s decline. The combination pushed bond yields and mortgage rates lower. Mortgage rates are closely related to the yields on long-term government bonds.

The following is a sampling of Bankrate’s average 30-year-mortgage interest rates this week in some U.S. metropolitan areas.

New York – 5.68 percent with 0.05 point

Los Angeles – 5.54 percent with 0.58 point

Chicago – 5.67 percent with 0.15 point

San Francisco – 5.61 percent with 0.43 point

Philadelphia – 5.58 percent with 0.13 point

Detroit – 5.47 percent with 0.46 point

Boston – 5.69 percent with 0.03 point

Houston – 5.51 percent with 0.65 point

Dallas – 5.51 percent with 0.61 point

Washington, D.C. – 5.53 percent with 0.44 point


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