Lenders kept mortgage interest rates steady for the fourth week in a row as disappointing news on the economy held bond rates under 3%. The average rate on the bench mark 30-year fixed rate loan was 4.51%, up a single basis point from last week.
Signs for an improvement in the U.S. economy were mixed. The seldom purchased 15-year fixed rate loan remained flat at 3.69%, according to Freddie Mac, which has kept tabs on the nation’s mortgage rates longer than any other entity.
The 5-year adjustable rate hybrid mortgage averaged 3.22% this week with an average of 0.6 point down three-basis points from last week. It was the lowest the mortgage has been, dipping below its previous record level set November 11, 2010.
“First quarter economic growth was revised up in the final estimate, but growth in consumer spending stagnated in May while April’s figure was revised downward,” said Freddie Mac economist Frank Nothaft. “Consumer expenditures account for roughly two-thirds of the nation’s gross domestic product.”
Pending home sales on existing properties rebounded in May, showing the largest monthly increase since last November. But the rate of pending sales seems to mean less and less every month as lenders refuse to provide mortgages on many homes and other real estate already under contract. Tighter appraisal standards and rigid mortgage underwriting guidelines are making it tough on consumers to obtain a mortgage.
Interest rates have been kept low by banks and mortgage lending companies for more than a year, and are expected to remain low through at least the rest of 2011.