Long- And Short-Term Mortgage Rates Creep Up This Week

McLEAN, VA -- In Freddie Mac's Primary Mortgage Market Survey, the 30-year fixed-rate mortgage (FRM) averaged 6.89 percent, with an average 0.7 point, for the week ending May 17, 2002, up from 6.79 percent last week. Last year at this time, the 30-year FRM averaged 7.14 percent.

The average for the 15-year FRM this week is 6.37 percent, with an average 0.8 point, up from last week's average of 6.27 percent. A year ago, the 15-year FRM averaged 6.67 percent.

One-year Treasury-indexed adjustable-rate mortgages (ARMs) averaged 4.81 percent this week, with an average 0.8 point, up from last week's average of 4.80 percent. This time last year, the one-year ARM averaged 5.81 percent.

(Average commitment rates should be reported along with average fees and points to reflect the total cost of obtaining the mortgage.)

"The market interpreted recently released retail sales figures as a sign that the economy may now be recovering faster than originally thought, bringing fear of inflation back into the picture," said Frank Nothaft, Freddie Mac's chief economist. "But the good news is that April's Consumer Price Index (CPI), which came out yesterday, indicates inflation remains under control. This should help keep mortgage rates stable for the foreseeable future.

"As expected, April housing starts were down from the extremely high levels recorded in the first quarter of the year. However, with mortgage rates continuing to remain below 7 percent, the housing industry will still experience a good year and continue to support the overall economy."

Published: May 17, 2002

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