Mortgage rates reverse course to new lows
Mortgage rates dropped to a record low this week, the first decline in a month, as the Federal Reserve began a program to buy Treasury bonds to support the economy.</br></br>The rate for a 30-year fixed loan fell to 4.17 percent from 4.24 percent, Freddie Mac said. That was the lowest level in the company's records dating to 1971. The average 15-year rate declined to 3.57 percent from 3.63 percent last week.</br></br>Rates on five-year adjustable-rate mortgages fell to their lowest level in at least five years. They averaged 3.25 percent, down from 3.39 percent a week earlier. It is the lowest rate on records dating back to January 2005.</br></br>The rates do not include add-on fees, known as points. One point is equal to 1 percent of the total loan amount. The average fee for 30-year and 15-year fixed loans in Freddie Mac's survey was 0.8 point. It was 0.7 point for one-year and five-year mortgages.</br></br>The Fed announced last week that it would buy $600 billion of Treasuries to keep interest rates low and boost economic growth, a method known as quantitative easing. Yields on government bonds serve as a benchmark for other debt, signaling home loan rates may fall further after seven months of declines.