Mortgage Rates Fall to Two Year Low

Washington DC, November 30, 2007--Interest rates appear to be headed lower in light of comments made by Federal Reserve Chairman Ben Bernanke on Thursday.

And that should help keep mortgage interest rates at their lowest level in more than two years and perhaps help to turn the housing market, which is expected to remain weak until well into next year.

Bernanke hinted that another interest rate cut may be needed to bolster the economy. The worsening credit crunch, a deepening housing slump and rising energy prices probably will create some “headwinds for the consumer in the months ahead,” he said.

Bernanke said he expects consumer spending will continue to grow and suggested the country can withstand the current problems without falling into a recession. But he indicated that consumers could turn more cautious as they try to cope with all the financial factors.

Freddie Mac, the mortgage company, reported Thursday that 30-year, fixed-rate mortgages averaged 6.10%. That was down from 6.2% last week and was the lowest rate since the week of Oct. 13. 2005, when rates stood at 6.03%.

Rates on 15-year fixed-rate mortgages, a popular choice for refinancing, slid to 5.73%, from 5.83% last week. This week's rate hasn't been lower since the week ending Jan. 26, 2006, when 15-year rates averaged 5.7%.