The average rate for the conventional 30-year fixed mortgage has dropped below the 4 percent mark for the first time in history, according to numbers released Thursday by ""Freddie Mac"":http://www.freddiemac.com.
[IMAGE]The GSE's market analysis also shows that the 15-year fixed rate â€" which has become a popular refinancing option among existing homeowners â€" fell to its lowest level on record for the sixth consecutive week.
Freddie Mac's ""regular weekly survey"":http://www.freddiemac.com/pmms/ of mortgage rates is based on data collected from about 125 lenders across the country.
[COLUMN_BREAK]The GSE puts the average rate for a 30-year fixed mortgage at 3.94 percent (0.8 point) for the week ending October 6, 2011. That's down 7 basis points from its average of 4.01 percent last week. As a point of comparison, last year at this time, the 30-year rate was 4.27 percent.
The 15-year fixed-rate mortgage came in at 3.26 percent (0.8 point) this week, dropping 2 basis points from 3.28 percent last week. A year ago at this time, the 15-year rate was averaging 3.72 percent.
Frank Nothaft, Freddie Mac’s chief economist, attributed the decline in fixed mortgage rates to a sharp drop in 10-year Treasuries earlier in the week as concerns over a global recession grew.
Adjustable-rate mortgages (ARMs) were mixed this week in Freddie's study. The 5-year ARM dropped from 3.02 percent to 2.96 percent (0.6 point), while the 1-year ARM rose from 2.83 percent to 2.95 percent (0.5 point).
At this time last year, the 5-year ARM was averaging 3.47 percent, and the 1-year ARM was 3.40 percent.
Nothaft tied the rise for 1-year ARMs to shorter-term Treasuries, noting that the Federal Reserve began replacing $400 billion in short-term Treasury securities with longer-term bonds this week.