Long-term mortgage rates were mixed this week while rates on adjustable loans declined, Freddie Mac reported today.

The average 30-year fixed-rate loan dipped to 6.01 percent from last week’s 6.05 percent, still below the year-ago average of 6.15 percent, according to Freddie Mac. On 15-year fixed-rate loans, the average was unchanged at 5.6 percent, considerably lower than the 5.87 percent reported a year ago.

To qualify for these rates, borrowers must pay points, or fees that lenders charge for loan processing expressed as a percent of the loan, which this week averaged 0.6 and 0.5, respectively, on the 30- and 15-year loans.

"Recent remarks by Federal Reserve (Fed) officials, which partly bolstered optimism that financial markets will recover later this year, helped mortgage rates ease up a little this week," said Frank Nothaft, Freddie Mac vice president and chief economist, in a prepared statement. "Fed Chairman Bernanke indicated in a speech on May 13th that the Fed stands ready to continue to add liquidity to the markets. On the same day, San Francisco Fed Bank President Janet Yellen added that she anticipates inflation will slow as commodity prices level off in the second half of the year.

"Despite the bleak housing market, there was positive news on the overall state of the economy. Retail sales (excluding automobiles) rose 0.5 percent in April, over twice that of market forecasts, and there was a significant upward revision in March’s figures as well. Also, the consumer price index for April rose less than expected, allaying some market concerns of inflation taking hold."

Rates fell on Treasury-indexed adjustable-rate mortgages (ARMs) this week, with the five-year hybrid ARM dropping to an average 5.57 percent from last week’s 5.67 percent and the average one-year ARM rate sinking from 5.29 percent to 5.18 percent. Points paid on the five- and one-year loans averaged 0.6 and 0.7, respectively.

A year ago, rates on the five- and one-year ARMs averaged 5.89 percent and 5.48 percent, respectively.


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