Mortgage rates continued to plunge to new lows this week, with interest rates on the 15-year fixed rate mortgage dipping below 3% for the first time on record.
The 30-year fixed mortgage, the most popular mortgage product, fell by 0.03 percentage points to 3.75%,setting yet another record for the fifth week in a row, according to a weekly survey by Freddie Mac. Last year, 30-year loans averaged 4.55%. The new low can save borrowers about $47 a month for every $100,000 borrowed. Over a 30-year term, that comes to $16,756.
Rates on the 15-year fixed mortgage, which is popular among those looking to refinance, fell to 2.97% -- the first time it has dropped below 3% since Freddie Mac began tracking the weekly data. Down from 3.74% a year ago, the new 15-year rate would lower borrowing costs to $689 a month for every $100,000 borrowed, a $37 savings compared to last year.
The continued slide in mortgage rates is, in part, due to ongoingeconomic turmoil in Europe, according to Freddie Mac's chief economist, Frank Nothaft.