The average on the 15-year fixed mortgage also dropped to 2.63 percent. That’s down from 2.65 percent last week and also a new record.
The average rate on the 30-year loan has been below 4 percent all year. It has fallen further since the Federal Reserve started buying mortgage bonds in September to encourage more borrowing and spending.
Home sales and construction are rising, providing a much-needed boost to the economy. Home prices are also increasing, which makes consumers feel wealthier and more likely to spend.
The average doesn’t include extra fees, known as points, which most borrowers must pay to get the lowest rates. One point equals 1 percent of the loan amount.
The average fee for 30-year loans was 0.7 point, unchanged from last week. The fee for 15-year loans also remained at 0.7 point.
The average rate on a one-year adjustable-rate mortgage ticked up to 2.56 percent from 2.55 percent. The fee for one-year adjustable-rate loans rose two-tenths to 0.5 point.
The average rate on a five-year adjustable-rate mortgage 2.74 percent, the same as the previous week. The fee was unchanged at 0.6 point.
Source: CHRISTOPHER S. RUGABER, AP Economics Writer
