Freddie Mac reported today that the average rate on a 30-year fixed rate mortgage loan fell to 5.14 percent, excluding points during this last week, down from 5.20 percent the week before. This is the third consecutive weekly rate drop and is certainly good news for mortgage applicants and lenders alike.

But the flip side is that rates are down because the economy is not moving very quickly. Freddie Mac chief economist and vice president Frank Nothaft said:

“The latest economic reports were influenced by recent energy-cost movements. Although higher gasoline prices fueled a 0.7 percent monthly jump in the consumer price index for June, the index was down 1.4 percent from June 2008 and represented the largest 12-month drop since January 1950.”

What’s more, a new report from the RealtyTrac, a foreclosure data tracking company, says that foreclosures are continuing to jump higher. There were 1.53 million homes in the foreclosure process in the first half of this year, a 9 percent increase from the previous six months and a 15 percent hike from the same time last year.

Said James J. Saccacio, chief executive officer of RealtyTrac:

“Foreclosure activity continues to increase to record levels. Unemployment related foreclosures account for much of this increased activity, and the high number of borrowers who find themselves owing more on their mortgages than their homes are now worth represent a potentially significant future risk.”

So if you have a job and you want a new mortgage loan, now is your time…if you can qualify for funding. But at least rates are down!