NEW YORK – Rates on 30-year fixed mortgages ticked up this week from the lowest level of the year.

Freddie Mac said Thursday that the average rate rose to 4.79 percent, up from 4.78 percent last week. A year ago, the rate averaged 5.29 percent.

Rates dropped to a record low of 4.71 percent in December, pushed down by a Federal Reserve program that reduced borrowing costs for consumers. That campaign ended in March.

Rates have fallen further as investors, wary of European turmoil, shifted money into the safety of U.S. Treasury bonds. Mortgage rates tend to track the interest rates paid on long-term Treasury bonds.

The average rate on a 15-year fixed-rate mortgage hit a record low of 4.20 percent, down from 4.21 percent last week. The 15-year fixed-rate mortgage is a popular choice for refinancing.

Rates on five-year, adjustable-rate mortgages averaged 3.94 percent, down from 3.97 percent a week earlier. Rates on one-year, adjustable-rate mortgages were unchanged at 3.95 percent.

The rates do not include add-on fees known as points. One point is equal to 1 percent of the total loan amount.

The nationwide fee for loans in Freddie Mac’s survey averaged 0.8 of a point for 30-year fixed-rate loans and 0.7 of a point for 5-year, 5-year loans and 1-year loans.

By J.W. Elphinstone
Source: Associated Press/AP Online
Publication date: June 3, 2010

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