Mortgage rates dip after economic reports

McLEAN, Va. -- Rates on 30-year mortgages dipped this week after economic reports came in better than expected, Freddie Mac said Thursday.

The average rate on a 30-year fixed rate mortgage was 5.22%, down from last week, when it was 5.25%. Last year at this time, the 30-year fixed rate mortgage rate averaged 6.52%.

Low mortgage rates can spur refinance activity and make home buying more attractive. Rates on 30-year mortgages dropped to a record low of 4.78% earlier this year.

Frank Nothaft, Freddie Mac's chief economist, said the economy slowed by an annual rate of 1% in the second quarter, "which was more positive than market forecasts."

"Home buyer demand improved as well, aided by high levels of housing affordability," Nothaft said.

Freddie Mac collects mortgage rates on Monday through Wednesday of each week from lenders around the country. Rates often fluctuate significantly, even within a given day.

The average rate on a 15-year fixed-rate mortgage fell to 4.63% from 4.69% last week, Freddie Mac said.

Rates on five-year, adjustable-rate mortgages averaged 4.73%, down from 4.75% last week. Rates on one-year, adjustable-rate mortgages dropped to 4.78% from 4.8%.

The rates do not include add-on fees known as points. The nationwide fee averaged 0.6 points for every loan in the survey except for one-year adjustable rate mortgages, which averaged 0.5 points.