30-year mortgage rate falls again

Mortgage rates sank near all-time lows this week, according to giant home-loan buyer Freddie Mac -- at least for those borrowers who have survived the recession with their credit ratings still solid and who are able to put 20% down.

For those lucky people, the average rate for a 30-year fixed-rate mortgage during the week ending Thursday was 4.94%, with borrowers paying 0.7% of the loan amount in upfront fees and points to the lender. (Paying points, each one equivalent to 1% of the loan, can reduce the interest rate on the mortgage.)

It was the first time since May that Freddie’s survey showed a 30-year rate beginning with a 4, although a Mortgage Bankers Assn. survey last week pegged rates at under 5%.

The all-time low for the Freddie Mac survey, which began in 1971, was recorded in April, when the average 30-year fixed rate for solid borrowers dropped to 4.78% with 0.7% in lender fees and discount points.

Last year at this time, 30-year fixed loans averaged more than 6%, and even a 15-year fixed loan was at 5.78%. In the Freddie Mac survey released Thursday, 15-year fixed loans averaged 4.36% with 0.6 of a point, an all-time low.

Although existing home sales fell somewhat in August, it was still the second strongest showing in 23 months, noted Freddie Mac chief economist Frank Nothaft.

“Low mortgage rates are helping to stabilize home sales,” Nothaft said in a Freddie Mac release.

Rates are falling because the Federal Reserve is buying $1.2 trillion in mortgage bonds cranked out by Freddie and other government-controlled entities.

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scott.reckard@latimes.com