Mortgage Rates Drop to Lowest Level In Five Decades

Alan Zibel
The Associated Press
July 2, 2010

WASHINGTON – July 2, 2010 – Mortgage rates have sunk to the lowest level in more than five decades, but consumers aren’t rushing to refinance their loans or buy homes.

Mortgage company Freddie Mac said Thursday the average rate for 30-year fixed loans sank to 4.58 percent this week.

That’s down from the previous record of 4.69  percent set last week and the lowest since the  mortgage company began keeping records in 1971.  The last time they were cheaper was the 1950s, when  most long-term home loans lasted just 20 or 25  years.

Rates have fallen over the past two months. Investors wary of the European debt crisis and the stock market have shifted money into the safety of Treasury bonds, driving down yields. Mortgage rates tend to track the yields on long-term Treasury’s.

On Wednesday, the yield on the benchmark 10-year Treasury note dropped to 2.95 percent. That was the first time it has fallen below 3 percent since April 2009, when the markets were beginning to recover from the financial crisis.
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