30-Year Mortgages Fall to 5-Week Low of 6.78%

The average interest rate on 30-year fixed-rate mortgages fell to a five-week low of 6.78% this week, Freddie Mac said. The decline, from 6.86% a week earlier and a three-month high of 6.93% two weeks earlier, followed last week’s reduction in short-term interest rates by the Federal Reserve. Seven weeks ago, the average dipped to 6.49%, a 31-year low, as investors scared by global financial turmoil shifted money into the United States. As confidence began to recover, rates rose. Still, the average has remained below 7% for five months. It reached 7.22% in late April, its peak so far for the year. Fifteen-year mortgages, a popular option for refinancing, averaged 6.44% this week, down from 6.51%. The rates do not include add-on fees known as points.