Mortgage rates fall to 38-year low

WASHINGTON, Jan. 15 (UPI) -- Interest rates for 30-year, fixed-rate U.S. mortgages fell to the lowest level since 1971, the Federal Home Loan Mortgage Corp. said Thursday.

The 30-year, fixed-rate mortgage averaged 4.96 percent with an average 0.7 points in the week ending Jan. 15, Freddie Mac said.

A week ago, 30-year, fixed-rate mortgages averaged 5.01 percent with an average 0.7 points.

It was the 11th consecutive week of declines, Freddie Mac said.

A year ago, the rates averaged 5.69 percent.

At 4.65 percent with an average 0.7 points, the 15-year, fixed-rate average increased slightly from the previous week's average of 4.62 percent. A year ago, 15-year fixed-rate mortgages averaged 5.21 percent.

The low rates are the result of "the slowing economy and government actions," said Frank Nothaft, Freddie Mac vice president and chief economist.

The Federal Reserve and U.S. Treasury Department have added $100 billion in liquidity to the mortgage market since September, Nothaft noted. The Fed may add an additional $570 billion more "to shore up mortgage lending and keep rates low," he said.

In addition, the unemployment rate climbed to 7.2 percent in December. "That brought down yields on Treasury securities and mortgage rates followed," he said.