Mortgage rates drop, Freddie Mac says; 15-year fixed at record low

Mortgage rates are sharply lower on news of a weakening job market, with the 30-year fixed loan averaging 3.88% this week and the 15-year fixed at a record low of 3.11%, according to Freddie Mac.

The average for the 30-year loan was down from 3.98% a week earlier, Freddie Mac said in its latest weekly report. The 15-year mortgage, popular with refinancers seeking to pay off their loans, was down from 3.21% a week ago. Its previous record low of 3.13% was set on March 8 this year.

The start rates for adjustable mortgages were little changed.

The rates tend to follow trends in Treasury bonds, a safe haven that looked appealing to investors this week after a weaker than expected jobs report for March led to a selloff in stocks. Heavy demand sent the yield on the 10-year Treasury note lower, pulling down long-term mortgage rates.

In another setback for the job market, new unemployment claims unexpectedly jumped last week, the government reported early Thursday.

The Freddie Mac survey, released each Thursday, asks lenders to report rates they are offering to borrowers with good credit and at least 20% downpayments or 20% home equity if they are refinancing. The borrowers would pay about 0.75% of the loan amount in upfront lender fees and discount points. The rates are for loans of up to $417,000.

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