Mortgage rates slide to historic lows for third time this month

Fixed mortgage rates didn't move much this week, but they declined enough to reach another record low, marking the third time this month and the 16th time this year they have hit historic lows.

The 30-year fixed-rate average, the most popular mortgage product, sank to 2.66% with an average 0.7 point, according to the latest data released Thursday by Freddie Mac. (Points are fees paid to a lender equal to 1% of the loan amount and are in addition to the interest rate.) It was 2.67% a week ago and 3.74% a year ago.

The 30-year fixed rate has never been this low since Freddie Mac began tracking mortgage rates in 1971. It surpassed the previous low of 2.67% set last week. Since the start of 2020, the 30-year rate has fallen more than a percentage point, going from 3.72% in January to 2.66% this week.

Freddie Mac, the federally chartered mortgage investor, aggregates rates from around 80 lenders across the country to come up with weekly national average mortgage rates. It uses rates for high-quality borrowers with strong credit scores and large down payments. These rates are not available to every borrower.

Because the survey is based on home purchase mortgages, rates for refinances may be different. This is especially true since the price adjustment for refinance transactions went into effect earlier this month. The adjustment is 0.5% of the loan amount (e.g., it is $1,500 on a $300,000 loan) and applies to all Fannie Mae and Freddie Mac refinances.

The 15-year fixed-rate average dropped to 2.19% with an average 0.5 point. It was 2.21% a week ago and 3.19% a year ago. The five-year adjustable rate average was unchanged at 2.79% with an average 0.2 point. It was 3.45% a year ago.

"Mortgage rates were little changed this week as markets digested the authorization of a second coronavirus vaccine and $900 billion stimulus...