30-Year Mortgage Rates Hold Steady on Fed Moves, Survey Finds

Long-term mortgage rates held steady for the week ended May 21 as moves by the government to keep rates low continue to take effect, according to Freddie Mac’s (FRE) latest survey.

The 30-year fixed-rate mortgage averaged 4.82%, a hair under last week’s average of 4.86%. While the rate is higher than the historic lows seen in April, it’s still well off the 5.98% rate recorded during the same week last year.

Mortgage rates have remained under 5% for the past ten weeks as a result of recent actions by the Federal Reserve and Treasury. In March, the Federal Reserve announced it would buy up more than $1 trillion in securities, and has since purchased $115 billion in Treasury bonds.

“Concerns about the economy are balancing out worries about the large issuance of government debt,” said Greg McBride, senior financial analyst at Bankrate.com. “Mortgage rates are in a bit of a holding pattern as a result.”

The Federal Reserve and Treasury have also picked up billions in mortgage-backed securities, with the Fed buying $740 billion through mid-May and the Treasury buying $136 billion through April, said Frank Nothaft, vice president and chief economist at Freddie Mac.

Freddie Mac’s latest survey comes on the heels of a move by President Obama to prop up the floundering housing market. On Wednesday, the president signed into law a measure that aims to stem foreclosures and prevent lenders from preying upon struggling homeowners.

The new measure, known formally as the Helping Families Save Their Homes Act, builds upon a program already in place that provides lenders with incentives to make loan modifications.