Mortgage Rates Continue ToFall

McLEAN, Va. - (06/10/05) -- Long-term mortgage rates declinedagain this week, to their lowest levels in 14 months, according toFreddie Mac. The average for the benchmark 30-year, fixed-rate loandipped to 5.56% this week, form 5.62% last week; while the averagefor the 15-year, fixed-rate mortgage fell to 5.14%, from 5.20%. ARMrates also moved lower, with the average for the five-year ARMslipping to 5.01%, from 5.10% last week; and the one-year ARMaverage edging down to 4.21%, from 4.26%. Frank Nothaft, chiefeconomist for Freddie Mac, said the recent fall in rates, fiveweeks in a row, has caused them to reconsider earlier forecasts ofhigher rates. "Taking into consideration the fact that mortgagerates have fallen from the earlier peak at the end of March, wehave lowered our forecast for long-term rates. We now expect thatthe 30-year fixed-rate mortgage rates will likely end up somewherebetween 5.9 percent and 6.2 percent by the end of this year," saidNothaft.