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Home Loan Rates Flatline

Monitor flatline
Mortgage loan interest rates remained flat this week according to Freddie Mac’s weekly survey.

Freddie Mac, a provider of stability and liquidity for the United States’ residential mortgage markets, conducts weekly surveys to assess four types of mortgage loan interest rates.

For the week ending Jan. 17, 2013, the 30-year fixed-rate mortgage (FRM) averaged 3.38 percent with an average 0.7 point. The rate is down from last week when it averaged 3.40 percent. At this time last year, the 30-year FRM averaged 3.88 percent.

The 15-year fixed-rate mortgage averaged 2.66 percent with a 0.7 point, the same as last week. A year ago, the 15-year fixed mortgage loan interest rate averaged 3.17 percent.

The 5-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) averaged 2.67 percent with a 0.6 point this week, the same as last week. Last year at this time, the 5-year ARM averaged 2.82 percent.

The 1-year Treasury-indexed ARM averaged 2.57 percent with a 0.4 point, down from last week’s 2.60 percent average. At this time last year, the 1-year ARM averaged 2.74 percent.

Frank Nothaft, vice president and chief economist for Freddie Mac, said mortgage loan interest rates were down due to reports that inflation remains contained.

Leonard Kiefer, Deputy Chief Economist at Freddie Mac, told loans.org that although “labor markets are improving, there is still considerable slack in the overall economy, reducing short term pressure on inflation.”

Inflation in 2012 was driven partly by high energy and food prices.

But the mortgage interest rates are on track with yearly predictions made at the end of 2012. Kiefer said that mortgage interest rates are moving in line with expectations.

“In 2012, following the Fed’s purchases of MBS (Mortgage-Backed Securities), mortgage rates came down and remain near historic lows,” Kiefer said.

He said that as long as unemployment remains around 6.5 percent, the Federal Reserve is committed to keeping short term interest rates low.

“This should translate to lower mortgage rates that only increase gradually as the economy heals and longer term expectations of economic growth improve,” Kiefer said to loans.org.

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