Freddie Mac: Concern Over Softening Housing Market Brings Interest Rate Drop

Today 7/26/07,  Freddie Mac reported that average mortgage interest rates for 30 and 15 year loans were lower. Nationally the average mortgage interest rate for 30 year fixed-rate mortgages was 6.69% (6.65% in the southeast), a drop from 6.73% a week ago. The average interest rate for 15 year fixed-rate mortgages was 6.37%, down from 6.38% last week.

Mortgage rates dropped due to worries that weak housing demand this spring will deter any quick recovery in the housing sector. For example, building permits in June fell to the slowest pace in 10 years. Information concerning the number existing home sales in June continued a four month decline.

Freddie Mac reports that the tightening of lending standards (especially on the subprime loans you have heard so much about in the news) and the 40 basis point jump on 30-year fixed-rate mortgages last month, have made borrowers think twice about buying a home. They report that the sales of single-family homes continues to slide downward.

Do keep in mind that we live in a very large and complex country. What happens in California is not necessarily what is happening in Florida. And what happens in Florida may be a far cry from what occurs in Michigan. Real estate is still very much a local issue.

If you want to learn more about Freddie Mac or see the details of their survey, go to: www.freddiemac.com  and click on the link for "Current Weekly Survey". They break down the survey by specific regions in the United States so you can see how your state compares to other parts of the country. They also explain the mission of Freddie Mac and offer a lot of useful information for consumers.

If you would like to speak with a lender you can find some at my website: www.jelwell.century21bnr.com . You can also speak with your own bank, credit union, or mortgage broker to see what your particular interest rate would be should you decide to finance a home purchase.