US long-term mortgage rates fall; 30-year average at 3.75%
WASHINGTON (AP) — U.S. long-term mortgage rates fell this week, edging toward three-year lows amid signals from Federal Reserve officials that they could cut their benchmark interest rate at their meeting next week.
Mortgage buyer Freddie Mac said Thursday the average rate on the key 30-year mortgage dipped to 3.75% from 3.81% last week. Those are historically low levels for the 30-year rate, which a year ago stood at 4.54%.
The average rate for 15-year, fixed-rate home loans fell to 3.18% from 3.23% last week.
On Thursday, the European Central Bank joined the Fed in making clear that more stimulus could be coming soon to support an economy weakening in the face of global trade tensions. The ECB’s rate-setting board left its key interest benchmarks unchanged at a policy meeting but said it could cut them as its next move.
Global economic growth is being dragged down by events like the U.S.-China trade war that have spurred a number of central banks to move toward providing greater stimulus. Central banks in South Korea, Indonesia and South Africa already have cut interest rates in recent days.
The Fed’s anticipated rate cut next week would undo some of the policymakers’ credit tightening from last year, when they raised rates four times. Many economists believe that the Fed will cut its benchmark rate, currently in a range of 2.25% to 2.5%, by a quarter-point at next week’s meeting and another quarter-point in September.
Freddie Mac surveys lenders across the country between Monday and Wednesday each week to compile its mortgage rate figures.
The average doesn’t include extra fees, known as points, which most borrowers must pay to get the lowest rates.
The average fee on 30-year fixed-rate mortgages fell this week to 0.5 point from 0.6 point.
The average fee for the 15-year mortgage was unchanged at 0.5 point.
The average rate for five-year adjustable-rate mortgages eased to 3.47% from 3.48% last week. The fee held steady at 0.4 point.