U.S. av­er­age mort­gage rates fall; 30-year loan at 4.75%

The Trentonian (Trenton, NJ) - - BUSINESS -

WASH­ING­TON >> U.S. long-term mort­gage rates fell this week amid a steep de­cline in stock prices.

Con­tin­ued slides in the stock mar­ket and tum­bling oil prices have been push­ing mort­gage rates lower, although home bor­row­ing rates re­main much higher than a year ago. Mort­gage gi­ant Fred­die Mac said Thurs­day the av­er­age rate on the bench­mark 30-year, fixed-rate mort­gage dipped to 4.75% from 4.81% last week. The key rate stood at 3.94% a year ago.

The rate on 15-year fixed-rate loans de­clined to 4.21% from 4.25% the pre­vi­ous week.

The fall in mort­gage rates “is a wel­come re­lief to prospec­tive home­buy­ers who have re­cently ex­pe­ri­enced ris­ing rates and ris­ing home prices,” Fred­die Mac chief econ­o­mist Sam Khater said.

The plunge in global stock mar­kets, which have been roiled by trade ten­sions be­tween the U.S. and China, ini­tially deep­ened Thurs­day. The Dow Jones In­dus­trial Av­er­age lost as much as 784 points in volatile trad­ing, af­ter plum­met­ing some 800 points on Tues­day. But the mar­ket staged a re­cov­ery later in the day, and the Dow av­er­age fin­ished only 79.40 points lower. U.S. mar­kets were closed Wed­nes­day be­cause of the na­tional day of mourn­ing for Pres­i­dent Ge­orge H.W. Bush.

Thurs­day’s broad de­cline came as news of the ar­rest of a se­nior Chi­nese tech­nol­ogy ex­ec­u­tive over­shad­owed some pos­i­tive com­ments on trade from Bei­jing, threat­en­ing to worsen U.S.-China trade ten­sions.

With stocks slid­ing, traders con­tin­ued to chan­nel money into bonds — a sig­nal that they see weak­ness in the econ­omy ahead. The yield on the key 10-year Trea­sury note, which tends to in­flu­ence mort­gage rates, dropped to 2.86% Thurs­day morn­ing from 2.92% on Tues­day as bond prices rose.

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