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Average US 30-year mortgage rate slips to 4.02 percent

Reuters Reuters
Manuel Armenta | 19 May, 2017, 19:23

Freddie Mac said the 30-year fixed-rate mortgage averaged 4.02% for the week ending May 18, down from 4.05%. A year ago at this time, the 30-year FRM averaged 3.58 percent.

There's nothing like a good old fashioned political crisis to make investors nervous and bring mortgage rates lower.

The rate for a jumbo 30-year FRM was down to 4.08% while the average 15-year FRM was down to 3.35%. US stocks plunged on Wednesday to the lowest level in a year as the controversy swirled over President Donald Trump's firing of former FBI Director James Comey, and the possible divulgence of classified information to the Russians.

While the White House scandal was the catalyst for a measurable drop in the past couple days, mortgage rates had already moved a bit lower thanks to a slower than expected rise in consumer prices.

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Another factor helping keep long-term yields, and mortgage rates by extension, in check is that the Federal Reserve seems poised to raise short-term interest rates as soon as June.

To calculate average mortgage rates, Freddie Mac surveys lenders across the country between Monday and Wednesday each week.

Sean Becketti, chief economist at Freddie Mac, forecast more rate declines were on the way. David Kuiper, vice president of Northpointe Bank in Holland, Michigan, is one who predicts home loan rates will head lower. The five-year adjustable rate average slipped to 3.13 percent with an average 0.5 point. The fee remained at 0.5 point.