WASHINGTON – Fixed mortgage rates have fallen to historic new lows for a fourth straight week and are likely to fall further, according to Freddie Mac.
The average for the 30-year, fixed-rate mortgage declined from 4.09% last week to 4.01% this week, the lowest rate since Freddie Mac began keeping records in 1971. The average for the 15-year loan also crept down this week from 3.29% to a new low of 3.28%.
ARM rates held near all-time lows, with the average for the five-year ARM remaining unchanged at 3.02%; and the average for the one-year ARM inching up to 2.83% from 2.82% last week.
Rates on mortgages could fall further after the Federal Reserve announced last week that it would take further action to try to lower long-term rates, Freddie noted.
The rate declines came on the heels of the Federal Reserve's "Operation Twist," where the central bank announced plans to shift its investment strategy toward longer-term securities in an effort to push long-term interest rates lower, while keeping short-term rates at very low levels.
“Fixed mortgage rates fell to all-time record lows this week following the Federal Reserve's announcement of its Maturity Extension Program and additional purchases of mortgage-backed securities," said Frank Nothaft, Freddie Mac's chief economist.
