Friday, August 27, 2010

Mortgage interest rates are already at their lowest level in decades, and this week, they headed even lower. The descent was prompted largely by fears that another housing downturn could hamper the economic recovery, after July’s home sales took a deeper plunge than expected.

Long-term mortgage rates have dropped to new record lows for nine weeks out of the last 10, according to Freddie Mac. This week, the GSE reports that the average rate for a 30-year fixed-rate mortgage (FRM) came in at 4.36 percent (0.7 point), down from 4.42 percent last week.

Rates for 15-year FRMs are now averaging 3.86 percent (0.6 point) in Freddie’s study. That’s down from last week’s average of 3.90 percent.

Adjustable-rate mortgages (ARMs), too, are treading extremely low. Freddie Mac says the 5-year ARM remained tied at its low for the survey at 3.56 percent (0.6 point). One-year ARMs dropped from 3.53 percent last week to 3.52 percent (0.7 point).