Mortgage rates fall to new lows for the year

Interest rates for fixed-rate home mortgages are hitting new lows for the year.

Lenders earlier this week offered a 30-year fixed-rate loan at an average interest rate of 3.97%, compared with 4.12% last week, Freddie Mac said Thursday. This week’s average was the lowest since the week of June 20, 2013, when lenders offered 30-year loans at 3.93%.

Rates are falling as worries over the global economy grow. Investors have bailed out of stocks and into ultra-safe U.S. Treasury bonds, driving down the annual interest rate on the 10-year Treasury note.

Because fixed mortgage rates tend to track the long-term Treasury yield, it’s become cheaper to borrow for a house.

Freddie Mac said the average rate for a 15-year fixed loan was 3.18%, down from 3.3% last week.

The mortgage giant’s survey asks lenders each Monday morning through midday Wednesday about the terms they are offering to solid borrowers on loans up to $417,000.

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