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US mortgage rates drop below 4%

Adam Williams
Written By:
Adam Williams
Posted:
Updated:
31/07/2015

The average mortgage rate in the United States has fallen below the 4% mark, market data has shown.

Global factors such as the decline in the Chinese stock market had attracted investors to the relative safety of the US bond market, analysts said.

This impacted on consumer mortgage rates, which closely follow the US Treasury’s 10-year bond rate.

Mortgage provider Freddie Mac said a typical mortgage was now on offer for below 4%.

A 30-year mortgage, the typical loan length in the country, is now available at 3.98%. This is down from 4.04% a week earlier, the bank said.

The average 15-year mortgage rate, typically used for remortgaging, fell by a similar amount. These loans are now available at a rate of 3.17%, down from 3.21% a week ago.

As with the UK, it is expected that the Federal Reserve – the American central bank – will raise base rate within the next year.

“The [30-year] mortgage rate has bounced between 3.98% and 4.09% since the first full week of June, falling a bit when events overseas take a turn for the worse and rising when the clouds appear ready to part,” said Freddie Mac chief economist Sean Becketti.

“With no clear direction coming from the Fed, we expect more of the same in coming weeks.”


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