WASHINGTON - Mortgage rates sank this week, reflecting investors' worries about the country's economic health.
Freddie Mac, the mortgage company, reported Thursday that 30-year fixed rate mortgages averaged 6.03 percent for the week ending March 6. That was down from last week's 6.24 percent, which had been the highest in more than three months.
'Weak economic reports that indicated declines in the job market, slowing in manufacturing and low consumer confidence drove bond yields lower this week and mortgage rates followed,' said Frank Nothaft, Freddie Mac's chief economist. 'Interest rates for 30-year fixed-rate mortgages are now at the same levels as they were two weeks ago, erasing last week's upward jump.'
Other mortgage rates also fell this week.
Rates on 15-year, fixed-rate mortgages, a popular choice for refinancing, dropped to 5.47 percent this week, from 5.72 percent last week.
For five-year adjustable-rate mortgages, rates fell to 5.34 percent, compared with 5.43 percent last week. And, rates on one-year adjustable-rate mortgages averaged 4.94 percent this week, down from 5.11 percent last week.
The mortgage rates do not include add-on fees known as points. Each mortgage type carried a nationwide average fee of 0.5 point.
A year ago, rates on 30-year mortgages stood at 6.14 percent, 15-year mortgage rates averaged 5.86 percent, five-year adjustable-rate mortgages were 5.90 percent and one-year adjustable-rate mortgages were 5.47 percent.
Housing has been suffering through a severe slump that has dragged down house prices in many parts of the country. The fallout is afflicting both homeowners and the economy at large, which many fear is on the brink of a recession or in one already.
Home foreclosures shot up to a record high in the final quarter of last year, the Mortgage Bankers Association reported Thursday.