News: US mortgage rates fall to new record lows
Average mortgage rates in the US dropped again this week breaking previous record lows. This is due to a contraction in the manufacturing sector and lower consumer spending.
According to mortgage giant Freddie Mac, the 30-year fixed-rate mortgage rate fell to 3.62 percent from 3.66 percent last week while 15-year fixed-rate mortgages are at 2.89 percent, down from 2.94 percent previously.
Frank Nothaft, Chief Economist at Freddie Mac, said: “Recent economic data releases of less consumer spending and a contraction in the manufacturing industry drove long-term Treasury bond yields lower over the week, and allowed fixed mortgage rates to hit new all-time record lows.”
15-year fixed rate loans are popular among borrowers looking to refinance or trade-up and reduce overall interest payments. Currently, homeowners with a US$200,000 (S$253,300) mortgage pay US$1,370 (S$1,735) per month and incur an interest of less than US$47,000 (S$ 59,525).
On the other hand, borrowers who opt for 30-year mortgages pay just US$911 (S$1,153) per month, but the interest amounts to US$128,000 (S$162,112).
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