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Mortgage Rates Stay at Record Lows as Europe Fears Linger

The story for mortgage rates stayed the same Thursday, with the specter of sovereign default overseas keeping investors close to Treasury debt and interest for home loans at all-time lows.


Both GSE ""Freddie Mac"":http://www.freddiemac.com/ and finance Web site ""Bankrate.com"":http://www.bankrate.com/ reported yet more troughs for fixed-rate mortgages, failing to break with more than two months of low interest rates for home loans.

For Freddie, the 30-year loan remained unchanged from last week at 3.87 percent, even while Bankrate.com found new record-breaking lows for the same at 4.10 percent, down from 4.14 percent last week.

""The benchmark 30-year fixed mortgage rate hit a new record low, setting a record for the second time in the past three


weeks,"" says ""Greg McBride"":http://www.bankrate.com/blogs/federal-reserve/about-greg-mcbride-cfa.aspx, a senior financial analyst with the finance Web site. ""Despite the better tone of U.S. economic data, the European debt crisis continues to hold mortgage rates in check.""

Lenders traditionally benchmark interest rates for mortgage loans against Treasury yields, which continue to widen as investors flee European notes and debt auctions for the safe haven of U.S Treasury debt.

Freddie said that the 15-year fixed-rate mortgage stayed the same from last week at 3.16 percent. For Bankrate.com, the figure fell a notch to crest at 3.35 percent, down from 3.36 percent last week.

Interest for the 5-year and 1-year adjustable-rate mortgages (ARMs) fell to 2.82 percent and 2.84 percent, respectively, according to Freddie, down from 2.83 percent and 2.78 percent, also respectively.

The finance Web site found 5-year and 1-year ARMs falling to 3.03 percent, down from 3.05 percent last week.

""Frank Nothaft"":http://www.freddiemac.com/bios/exec/nothaft.html, VP and chief economist with Freddie, attributed the figures in a statement to waxing signs of confidence for the economy.

He noted a marginal increase for small business confidence, registered by the National Federation of Independent Business, just as a Reuters/University of Michigan index observed declines for consumer sentiment in February.

About Author: Ryan Schuette

Ryan Schuette is a journalist, cartoonist, and social entrepreneur with several years of experience in real-estate news, international reporting, and business management. He currently lives in the Washington, D.C., area, where he freelances for DS News and MReport.

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