The typical rate for a 30-year mortgage reached yet another record low this week by plunging to 3.56%, according to Freddie Mac -- the 11th time in the past 12 weeks that rates set or tied a record.
Freddie Mac's weekly report, based on a survey of what lenders are offering borrowers, was down from 3.62% last week, putting it nearly a full percentage point lower than the 4.51% average a year ago.
The 15-year fixed loan rate also broke a record set a week earlier, dropping from 2.89% on average to 2.86%.
Borrowers would have paid about 0.7% of the loan balance to lenders to obtain the rates, according to Freddie Mac. Paying additional discount points upfront can further lower mortgage rates, and mortgage professionals say solid borrowers who shop around often can find slightly lower rates than those in the Freddie Mac survey.
Freddie Mac, the McLean, Va., mortgage finance giant propped up by tens of billions of taxpayer dollars, asks lenders each week what rates they are offering to borrowers with solid credit and at least 20% downpayments on the properties, or 20% equity if they are refinancing.
The record low rates follow an easing of the yield on the 10-year Treasury note, which serves as a benchmark for fixed mortgage rates. The decline followed a lackluster employment report for June, an indication that the economy's recovery remains tepid.
Minutes of the Federal Reserve's last monetary policy meeting revealed that some members of the board feel another round of stimulus will be needed to keep the economy on track.
Economic worries drove stock prices lower by about 1% Thursday morning as markets opened, with the yield on the 10-year bond edging lower -- raising the possibility of further declines in mortgage rates.
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