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Mortgage Rates for U.S. Loans Fall as 30-Year at 4.14%

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Existing Home Sales
A real estate agent, center, talks with potential buyers in a previously owned home in Mackinaw, Illinois. Photographer: Daniel Acker/Bloomberg

May 22 (Bloomberg) -- U.S. mortgage rates fell for a fourth week, reducing borrowing costs for homebuyers during the key spring selling season.

The average rate for a 30-year fixed mortgage was 4.14 percent this week, down from 4.2 percent and the lowest since late October, Freddie Mac said in a statement today. The average 15-year rate slipped to 3.25 percent from 3.29 percent, the McLean, Virginia-based mortgage-finance company said.

Sales of previously owned homes rose 1.3 percent in April, the first increase in four months, the National Association of Realtors said today. The drop in loan costs this month may help spur some would-be buyers, said Keith Gumbinger, vice president of HSH.com, a Riverdale, New Jersey-based mortgage-data firm.

“With a combination of a flatter trajectory for home prices and lower rates, that should be preserving affordability as we go through the spring homebuying season,” Gumbinger said in a telephone interview yesterday.

Price gains have slowed, according to the S&P/Case-Shiller index of 20 U.S. cities. In the year ended February, the measure rose 12.9 percent, the smallest increase since August, after a 13.2 percent advance in the 12 months through January.

To contact the reporter on this story: Prashant Gopal in Boston at pgopal2@bloomberg.net

To contact the editors responsible for this story: Kara Wetzel at kwetzel@bloomberg.net Christine Maurus

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