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30-year mortgages unchanged

Associated Press

WASHINGTON – Rates on 30-year mortgages, after declining for three weeks, were unchanged this week while other types of mortgages dipped lower on expectations of slower economic growth in coming months.

Mortgage giant Freddie Mac reported Thursday that the nationwide average for rates on 30-year, fixed-rate mortgages remained frozen at 5.71 percent this week, the same as last week. The 30-year rate had fallen for three weeks, pushing it down to the lowest point since mid-July.

Analysts said continued low mortgage rates were helping to keep housing sales near record levels and they predicted rates would likely fall further in coming weeks as the drag on growth from Hurricane Katrina lessens fears in the bond market that stronger growth might trigger inflation pressures.

Frank Nothaft, chief economist at Freddie Mac, said that while he expected economic growth to be a bit slower this year, the pace of activity next year will be higher, reflecting increased federal spending on rebuilding and lower interest rates brought on by the disaster.

Rates on 15-year, fixed-rate mortgages, a popular choice for refinancing a home mortgage, averaged 5.30 percent this week, down from 5.32 percent last week.

One-year adjustable rate mortgages edged down slightly to 4.45 percent from 4.48 percent last week. In mid August, one-year ARMs hit their highest level in more than three years at 4.58 percent.

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