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In this July 10, 2014 photo, a sold sign is posted outside a home in Quincy, Mass. Freddie Mac reports on average U.S. mortgage rates for this week on Thursday, July 31, 2014. (AP Photo/Michael Dwyer)
Average US 30-year mortgage rate at 4.12 percent
First Published Jul 31 2014 09:16 am • Last Updated Jul 31 2014 09:16 am

Washington • Average U.S. mortgage rates declined slightly this week, hovering near their lows for the year.

Mortgage company Freddie Mac said Thursday that the nationwide average for a 30-year loan slipped to 4.12 percent from 4.13 percent last week. The average for the 15-year mortgage, a popular choice for people who are refinancing, declined to 3.23 percent from 3.26 percent last week.

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Mortgage rates are below the levels of a year ago. They have fallen in recent weeks after climbing last summer when the Federal Reserve began talking about reducing the monthly bond purchases it was making to keep long-term borrowing rates low.

The Fed issued a statement Wednesday after a two-day policy meeting suggesting that it wants to see further improvement in the economy before it starts raising its key short-term interest rate. The central bank offered no clearer hint of when it will raise that rate, which is at a record low near zero.

Home prices rose in May from a year earlier at the weakest pace in 15 months, data released Tuesday showed, as sales remain modest in the spring buying season.

The Standard & Poor’s/Case-Shiller 20-city home price index increased 9.3 percent in May from 12 months earlier. But that’s down from 10.8 percent in the previous month and was the smallest annual gain since February 2013.

At 4.12 percent, the rate on a 30-year mortgage is down from 4.53 percent at the start of the year. Rates have fallen even though the Fed has been trimming its monthly bond purchases. The Fed said Wednesday that it will slow the pace of its purchases by another $10 billion to $25 billion a month. The purchases are set to end in October.

To calculate average mortgage rates, Freddie Mac surveys lenders across the country between Monday and Wednesday each week. The average doesn’t include extra fees, known as points, which most borrowers must pay to get the lowest rates. One point equals 1 percent of the loan amount.

The average fee for a 30-year mortgage was 0.6 point, unchanged from last week. The fee for a 15-year mortgage rose to 0.7 point from 0.6 point last week.

The average rate on a five-year adjustable-rate mortgage increased to 3.01 percent from 2.99 percent. The fee remained at 0.5 point.


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For a one-year ARM, the average rate edged down to 2.38 point from 2.39 percent. The fee held at 0.4 point.



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