Mortgage rates declined for the first time in four weeks as the bond market reacted to the news from the Federal Reserve Board's July meeting, according to Freddie Mac.
The 30-year fixed-rate mortgage averaged 3.43% for the week ending Aug. 4,
The Fed did not raise short-term rates in July and even though that was expected, it still was one of the factors driving up the price on the 10-year Treasury note (which in turn reduces the yield paid to investors).
"Treasury yields fell last week following both the FOMC's meeting and a disappointing advance estimate for second-quarter GDP. Mortgage rates, which had moved up 7 basis points over the past three weeks, responded by erasing most of those gains," said Sean Becketti, chief economist at Freddie Mac.
The 15-year FRM averaged 2.74%, down from last week when it averaged 2.78%. A year ago at this time, the 15-year averaged 3.13%.
The five-year Treasury-indexed hybrid adjustable-rate mortgage averaged 2.73%, down from last week when it averaged 2.78%, while a year ago it averaged 2.94%.
"Borrowers are taking advantage of these low rates by refinancing. The
