LITTLE ROCK — QUOTE OF THE DAY
“Boeing’s victory was a major upset, and not at all what the industry was expecting.”
Richard Aboulafia, a military aircraft analyst with the Fairfax, Va.-based Teal Group,
talking about the new U.S. Air Force aerial-refueling-tanker contract Article, 1D30-year mortgage rates dip to 4.95%
NEW YORK - The average rate on the 30-year fixed mortgage fell below 5 percent this week, as investors sought more Treasury notes amid growing tension in the Middle East.
Freddie Mac said Thursday that the average rate on the 30-year loan slipped to 4.95 percent from 5 percent. It hit a 40-year low of 4.17 percent in November.
The average rate on the 15-year fixed home loan fell to 4.22 percent from 4.27 percent. It reached 3.57 percent in November, the lowest level on records dating back to 1991.
Mortgage rates tend to track the yield on the 10-year Treasury note. It fell this week as investors shifted money out of stocks and into safer assets amid escalating violence in Libya.
To calculate average mortgage rates, Freddie Mac, the Federal Home Loan Mortgage Corp., collects rates from lenders across the country Monday through Wednesday of each week. Rates often fluctuate significantly, even within a single day.
The average rate on a five-year adjustable-rate mortgage fell to 3.80 percent from 3.87 percent. The five-year hit 3.25 percent last month, the lowest rate on records dating back to January 2005.
The average rate on one-year adjustable-rate home loans edged up to 3.40 percent from 3.39 percent.
Two mortgage giants whittle losses
WASHINGTON - Government-controlled mortgage buyers Fannie Mae and Freddie Mac on Thursday posted narrower losses for the October-December quarter of last year, and both asked for additional federal aid.
Fannie Mae lost $2.1 billion and asked for an additional $2.6 billion in federal aid. That compares with a loss of $16.3 billion, or $2.87 a share, in the fourth quarter of 2009.
Freddie Mac managed a narrower loss of $1.7 billion and asked for an additional $500 million in federal aid - up from the $100 million it sought in the previous quarter. It logged a loss of $7.8 billion, or $2.39 a share, in the fourth quarter of 2009.
Fannie Mae, the Federal National Mortgage Association, reported a $21.7 billion loss for all of 2010. Freddie Mac, the Federal Home Loan Mortgage Corp., posted a $19.8 billion loss for 2010.
The government rescued Fannie Mae and Freddie Mac in September 2008 to cover their losses on soured mortgage loans. It estimates the bailouts will cost taxpayers as much as $259 billion.
Fannie Mae and Freddie Mac own or guarantee about half of all mortgages in the U.S., or nearly 31 million home loans worth more than $5 trillion. Along with other federal agencies, they played some part in almost 90 percent of new mortgages over the past year.
Sears’ quarterly profit declines 13%
Sears Holdings Corp., the largest U.S. department-store chain, said fourth-quarter profit fell 13 percent after same store sales at Christmas declined. The shares slid the most in three months.
Net income dropped to $374 million, or $3.43 a share, in the quarter that ended Jan. 29, from $430 million, or $3.74, a year earlier, the Hoffman Estates, Ill.-based company said Thursday. Adjusted earnings per share were $3.60, compared with a company forecast of $3.39 to $4.12.
Falling sales of consumer electronics and clothing led to a 4.5 percent decline in sales by domestic Sears stores open at least 12 months. Chairman Edward Lampert said in a letter on the company’s website that “our financial results remain at unacceptable levels.” He cited delays in shifting to redesigned Kenmore appliances among Sears “missteps” in big-ticket items.
Sears fell $4.83, or 5.5 percent, to close at $82.40. Earlier, the shares dropped as much as 6 percent, the steepest slide since Nov. 18.
Business, Pages 28 on 02/25/2011