Freddie Mac finds mortgage dropping to yearly low

By Palm Beach Business.com

DELRAY BEACH — Uncertainty over the economic recovery continues to push mortgage rates lower, according to the latest weekly surveys from Freddie Mac and Bankrate.

The 30-year, fixed-rate mortgage dropped to 4.63 percent with 0.7 point, down from 4.71 percent a week ago, according to Freddie Mac’s Primary Mortgage Market Survey. That’s the low for the year to date, according to the Freddie Mac survey.

Bankrate’s national mortgage survey has the 30-year at 4.82 percent with 0.40 point, down from 4.88 percent a week ago.

Both Freddie Mac and Bankrate cited last week’s conflicting employment numbers as the reason behind the drop. While the Labor Department reported that the economy added  jobs in April — the strongest performance in months — it also reported a day earlier that first-time claims for unemployment insurance soared during the previous week.

Freddie Mac also noted that despite the high number of jobs added, the unemployment rate actually moved higher. Other consumer-related data was weak.

"Mortgage rates continued to decline this week following a mixed employment report,” Freddie Mac Chief Economist Frank Nothaft said. “The economy added a healthy number of 244,000 workers in April, the most in 11 months, and the figures for March and February were revised up by 56,000 more jobs. However, the unemployment rate rose to 9.0 percent from 8.8 percent in March and was the highest reading since January. In addition, wages grew by only 0.1 percent, which was below the market consensus forecast.”

Also from the surveys: The 15-year, fixed-rate mortgage fell to 3.82 percent with 0.7 point from 3.89 percent a week earlier, according to Freddie Mac. Bankrate, meanwhile, said the 15-year dropped to 4.00 percent with 0.34 point from 4.05 percent a week ago.