After inching forward in the last few weeks, mortgage rates again plummeted on fresh concerns about the euro zone crisis, with rates dropping to 4.00 percent, the second-lowest reading for ""Freddie Mac"":http://www.freddiemac.com/.[IMAGE]
The GSE released a weekly survey alongside finance Web site ""Bankrate.com"":http://www.bankrate.com/.
Freddie reported the 30-year loan falling from 4.24 percent recorded last week, not a far cry from the 10-percentage point plunge to 4.23 percent from 4.33 percent that Bankrate.com recorded.
The finance Web site offered lows for the 15-year loan as well, with the fixed-rate mortgage sliding to 3.48 percent from 3.57 percent, while Freddie saw rates for the mortgage product falling to 3.31 percent, down from 3.38 percent last week.
""Market concerns over the European debt market drew investors to U.S. Treasury securities, lowering bond yields and mortgage rates,"" ""Frank Nothaft"":http://www.freddiemac.com/bios/exec/nothaft.html, VP and chief economist with Freddie, said in a statement.[COLUMN_BREAK]
He flipped the sour news by also citing surges in economic growth and consumer expenditures, as reported by the ""Bureau of Economic Analysis"":http://www.bea.gov/ and a Thomson Reuters/University of Michigan index.
""Uncertainty about the European financial rescue package caused renewed financial jitters and a stampede back into safe haven U.S. government bonds,"" Bankrate.com added in a ""statement"":http://phx.corporate-ir.net/phoenix.zhtml?c=61502&p=irol-newsArticle&ID=1625612&highlight=.
Treasury-indexed adjustable-rate mortgages (ARMs) also fell for the 5-year and 1-year, according to Freddie, which reported the former cresting at 2.96 percent this week, down from 3.08 percent over the last, and the latter at 2.88 percent, also down from 2.90 percent.
Bankrate.com reported that the 5-year and 1-year ARMs dipped by a few percentage points to 3.18 percent this week, down from 3.22 percent last week.
The plunge in mortgage rates this week follows a rush by investors to Treasury debt, seen as safe haven by many in contrast with the volatility in the euro zone.
Investor confidence went up on news last week that European leaders had cobbled together trillions of dollars to write down Greek debt by 50 percent, bail out the debt-ridden Mediterranean country, and impose fiscal austerity measures in exchange.
The confidence spike deflated with a parliamentary address earlier this week in which Greek Prime Minister George Papandreou pledged to hold a popular referendum on whether to accept the bailout package.
By early Thursday ""CNN"":http://www.cnn.com/2011/11/03/world/europe/greece-main/index.html?hpt=hp_t1 reported that the Greek prime minister had decided to scuttle the proposed referendum, although it was still unclear whether it remains optional.