WASHINGTON, Sept. 8 (UPI) -- Long-term mortgage rates dropped to record lows during the week ending Thursday, the U.S. Federal Home Loan Mortgage Corp. reported.
After interest rates rose in the previous week, Freddie Mac said the average interest rates for 15-year loans fell from 3.39 percent to 3.33 percent while interest rates on 30-year fixed-rate loans dropping from 4.22 percent to 4.12 percent.
Rates for 15-year fixed-rate mortgages a year ago stood at 3.83 percent. Rates for 30-year mortgages a year ago averaged 4.35 percent.
Frank Nothaft, Freddie Mac's vice president and chief economist, said the weak economy was not supporting higher interest rates.
"Market concerns over Eurozone sovereign debt default and a weak U.S. employment report for August placed downward pressure on Treasury bond yields and allowed fixed mortgage rates to hit new lows this week," he said.
High unemployment makes it harder for interest rates to climb, as demand is soft and there are fewer consumers able to pay higher rates. As such, interest rates yields have dropped with unemployment above 8 percent for the 31rst consecutive month, "the longest such stretch in 70 years," Nothaft said.