NEW YORK (CNNfn) - Mortgage rates dipped lower in the latest week, influenced in part by Fed Chairman Alan Greenspan's remarks about another possible interest rate cut.|
According to Freddie Mac, the benchmark 30-year fixed-rate mortgage (FRM) averaged 7.08 percent for the week ending July 20, down from 7.21 percent the previous week. A year ago, the same mortgage averaged 8.21 percent.
The average this week for the 15-year fixed-rate mortgage was 6.65 percent, down from the previous week's average of 6.76 percent. A year ago, the same rate stood at 7.93 percent.
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One-year adjustable-rate mortgages (ARMs) averaged 5.62 percent, falling from last week's average of 5.79 percent. The same mortgage averaged 7.32 percent at this time last year.
"Fed Chairman Alan Greenspan's testimony before Congress yesterday indicating that the Fed may cut rates again helped to ease bond yields, and this may translate into even lower rates next week," Freddie Mac chief economist Robert Van Order said.
"Recent economic problems in Argentina has prompted foreign investors to withdraw their portfolios from that country and invest instead in safer U.S. bonds. That has caused bond yields to fall, pushing mortgage rates lower," Van Order said.
[Click here to see a breakdown of U.S. mortgage rates by region]
Freddie Mac (FRE: Research, Estimates), or Federal Home Mortgage Corp., is a publicly traded company the government established in 1970 to provide a flow of funds to mortgage lenders.
It buys mortgages from banks, bundles them and then resells them as mortgage-backed securities. Its products, and the products of other similar entities, have become increasingly popular as an alternative to government-backed bonds, particularly with international investors.