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Mortgage Rates For Week Ending July 12, 2007

Mortgage Rates Reverse Downward Trend This Week

Short - Term Rates Remain Mixed
McLean, VA Freddie Mac (NYSE:FRE) today released the results of its Primary Mortgage Market Survey (PMMS) in which the 30-year fixed-rate mortgage (FRM) averaged 6.73 percent with an average 0.4 point for the week ending July 12, 2007, up from last week when it averaged 6.63 percent. Last year at this time, the 30-year FRM averaged 6.74 percent.

The 15-year FRM this week averaged 6.39 percent with an average 0.4 point, up from last week when it averaged 6.30 percent. A year ago, the 15-year FRM averaged 6.37 percent.

Five-year Treasury-indexed hybrid adjustable-rate mortgages (ARMs) averaged 6.35 percent this week, with an average 0.5 point, up from last week when it averaged 6.29 percent. A year ago, the 5-year ARM averaged 6.33 percent.

One-year Treasury-indexed ARMs averaged 5.71 percent this week with an average 0.5 point, unchanged from last week. At this time last year, the 1-year ARM averaged 5.75 percent.

(Average commitment rates should be reported along with average fees and points to reflect the total cost of obtaining the mortgage.)

"A favorable employment report for June and robust consumer credit growth for May pushed long-term mortgage rates higher in the past week, nearly eliminating the declines made in rates over the previous three weeks," said Frank Nothaft, Freddie Mac vice president and chief economist. "In addition, consumer credit jumped by $12.9 billion in May, almost double market expectations.

"Our July economic outlook forecasts 30-year fixed-rates to stay around their current level through the end of year. The refinance share of loan applications is expected to continue decreasing throughout the same time frame, averaging about 35 percent in 2007, the lowest level since 2000. Freddie Mac expects weakness in the housing market to persist in the second half of the year, with 2007 total home sales and housing starts hitting 5-year lows."

Freddie Mac is a stockholder-owned company established by Congress in 1970 to support homeownership and rental housing. Freddie Mac fulfills its mission by purchasing residential mortgages and mortgage-related securities, which it finances primarily by issuing mortgage-related securities and debt instruments in the capital markets. Over the years, Freddie Mac has made home possible for one in six homebuyers and more than four million renters in America.