Mortgage Rates Plunge In Reversal OfFortune

McLEAN, Va. - (09/12/03) -- Long-term mortgage rates reversedtheir three-month climb and dropped last week to their lowest in ayear, according to Freddie Mac. Frank Nothaft, chiefeconomist for the secondary mortgage giant, attributed the drop inrates to the weak jobs reports in August, which drove up Treasuryprices and pushed yields lower. "The release of the August jobsreport showed a continuation of the jobless recovery," saidNothaft. "This, of course, caused interest rates, includingmortgage rates, to ease back from the highest level we have seen ina year." The average for the benchmark 30-year, fixed-rate mortgageplunged all the way from 6.44% last week, to 6.16% this week, justbelow the 6.18% mark it stood at a year ago. The average for the15-year, fixed-rate loan fell from 5.77% last week, all the way to5.46%, compared to 5.59% a year ago. The average for the one-yearARM also declined from 3.98% last week, to 3.87%.