(CN) – The long-term interest rate for consumers buying homes across the United States eased slightly this week, Freddie Mac says.
The Federal Home Loan Mortgage Corporation, known as Freddie Mac, is a public government-sponsored enterprise created in 1970 to expand the secondary market for mortgages in the United States.
In its weekly mortgage survey it found the rate on 30-year fixed-rate loans slipped to an average 4.17 percent from 4.19 percent last week.
This time last year the benchmark rate stood at 3.65 percent.
The average for a 15-year mortgage declined to 3.39 percent from 3.41 percent last week.
Investopedia defines mortgage rates simply as the rate of interest charged on a mortgage.
They are determined by the lender in most cases, and can be either fixed, stay the same for the term of the mortgage, or variable, fluctuate with a benchmark interest rate.
Mortgage rates rise and fall with interest rates and can drastically affect the homebuyers’ market.
To calculate average mortgage rates, Freddie Mac surveys lenders across the country between Monday and Wednesday each week.
The average doesn’t include extra fees, known as points, which most borrowers must pay to get the lowest rates. One point equals 1 percent of the loan amount.
The average fee for a 30-year mortgage fell this week to 0.4 point from 0.5 point. The fee on 15-year loans also declined to 0.4 point from 0.5 point.
Rates on adjustable five-year loans dipped to 3.21 percent from 3.23 percent. The fee remained at 0.4 point.