Rates unchanged on 30-year mortgages

July 21, 2007 - 0:0

WASHINGTON (AP) -- Rates on 30-year mortgages were unchanged this week as a flood of new economic data did not change the general views of financial markets about inflation.

Freddie Mac, the mortgage company, reported Thursday that 30-year fixed-rate mortgages averaged 6.73 percent this week, the same as last week. That left the rate close to its high-point of the year, which was 6.74 percent set the week of June 14. Government reports this week showed that inflation at the wholesale and consumer levels came down in June, reflecting big declines in gasoline prices. However, gasoline costs have been rising again in July. Federal Reserve Chairman Ben Bernanke, delivering the Fed's midyear economic forecast, told Congress that inflation remains the central bank's biggest worry. ""In a week marked by stock indexes reaching new highs on Wall Street, mortgage rates lingered near the previous week's level as the latest economic indicators did not affect inflation expectations,"" said Frank Nothaft, chief economist at Freddie Mac. At their last meeting on June 27-28, Federal Reserve policy-makers decided to hold a key interest rate unchanged while noting that some readings on core inflation had improved. Many economists believe the Fed, which last changed rates a year ago, will remain on hold into 2008. According to the Freddie Mac survey, rates on 15-year fixed-rate mortgages, a popular choice for refinancing, edged down slightly to 6.38 percent this week, compared with 6.39 percent last week. Rates on five-year adjustable-rate mortgages averaged 6.35 percent this week, the same as last week. Rates on one-year adjustable-rate mortgages edged up slightly to 5.72 percent from 5.71 percent. The mortgage rates do not include add-on fees known as points. Both 30-year and 15-year mortgages carried a nationwide average fee of 0.4 point, while five-year ARMs and one-year ARMs both carried an average fee of 0.5 point. A year ago, rates on 30-year mortgages stood at 6.80 percent, 15-year mortgages were at 6.41 percent, five-year adjustable-rate mortgages averaged 6.36 percent and one-year ARMs were at 5.80 percent