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Bankrate: Mortgage Rates Hold Steady Ahead of Economic Reports
New York, New York, USA, 31 August 2006 -- /PRNewswire/ -- All good things must come to an end. After falling for five straight weeks, fixed mortgage rates were barely changed this week ahead of a batch of economic reports. The average 30-year fixed rate mortgage ticked higher to 6.49%. According to Bankrate.com's weekly national survey of large lenders, the 30-year fixed rate mortgages had an average of 0.36 discount and origination points.

The average 15-year fixed rate mortgage popular for refinancing did the same, increasing to 6.2%. On larger loans, the average jumbo 30-year fixed rate dipped to 6.73%. Adjustable rate mortgages also backtracked. The average 5/1 adjustable rate mortgage slid to 6.22%, and the average one-year ARM retreated below the 6% mark for the first time since 14 June, settling at 5.98%.

One week after hitting a five-month low, mortgage rates were largely unchanged as financial markets awaited several key economic indicators this week. The releases scheduled for this week include a revision to second quarter economic growth, an important gauge of the manufacturing sector, and the August employment report. Recent evidence of slower economic growth helped bring fixed mortgage rates to that five-month low. With the negative economic news seemingly priced in, any indication that the economic glass is half-full rather than half-empty could see bond yields and fixed mortgage rates rise from current levels. Fixed mortgage rates are closely related to yields on long-term government bonds.

Fixed mortgage rates are still nearly one-half of a percentage point lower than when the Fed last hiked rates at the end of June. At the time, the average 30-year fixed mortgage rate was 6.93%, meaning that the monthly payment on a loan of $165,000 was $1090. With the average 30-year fixed rate now 6.49%, the same loan originated today would carry a monthly payment of $1041.83. Fixed mortgage rates remain an attractive refinancing alternative for adjustable rate borrowers facing sharp payment adjustments.


30-year fixed: 6.49% -- up from 6.48% last week (avg. points: 0.36)
15-year fixed: 6.2% -- up from 6.19% last week (avg. points: 0.28)
5/1 ARM: 6.22% -- down from 6.24% last week (avg. points: 0.34)

Bankrate's national weekly mortgage survey is conducted each Wednesday from data provided by the top 10 banks and thrifts in the top 10 markets.

For a full analysis of this week's move in mortgage rates, go to: http://www.bankrate.com/mortgagerates

The survey is complemented by Bankrate's weekly forward-looking Rate Trend Index, in which a panel of mortgage experts predicts which way the rates are headed over the next 30 to 45 days. The panelists don't see rates resuming the decline. Just 14% expect rates to fall again, with the remaining majority evenly divided between rates rebounding or remaining unchanged in the next 30 to 45 days.

For the full mortgage Rate Trend Index, go to: http://www.bankrate.com/RTI

About Bankrate, Inc.

Bankrate, Inc. (NASDAQ:RATE) owns and operates Bankrate.com, a leading Internet consumer banking marketplace. Bankrate.com is a destination site of personal finance channels, including banking, investing, taxes, debt management and college finance. It is the leading aggregator of more than 300 financial products, including mortgages, credit cards, new and used auto loans, money market accounts and CDs, checking and ATM fees, home equity loans and online banking fees. Bankrate.com reviews more than 4800 financial institutions in 575 markets in 50 states. In 2005, Bankrate.com had over 46 million unique visitors. Bankrate.com provides financial applications and information to a network of more than 75 partners, including Yahoo! (NASDAQ:YHOO), America Online (NYSE:TWX), The Wall Street Journal (NYSE:DJ) and The New York Times (NYSE:NYT). Bankrate.com's information is also distributed through more than 400 national and state publications. In addition to Bankrate.com, Bankrate, Inc. also owns and operates FastFind, an internet lead aggregator and MMIS/Interest.com, which publishes mortgage guides and financial rates and information.


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