US Fixed Mortgage Rates Drop to Record Lows

US fixed mortgage rates this week hit new record lows for the second straight week on the Federal Reserve's mortgage securities buying and weakening economic indicators, showed the Primary Mortgage Market Survey released by Freddie Mac.

The mortgage giant said that 30-year fixed-rate mortgage (FRM) was 3.36 percent in the week ending Oct. 4, down from last week's 3.40 percent. Last year at this time, the 30-year FRM was 3.94 percent.

The 15-year FRM, a popular choice for those looking to refinance, declined to 2.69 percent from 2.73 percent in the previous week. A year ago at this time, the 15-year FRM averaged 3.26 percent.

However, the five-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) inched up to 2.72 percent, while the one-year Treasury-indexed ARM was down to 2.57 percent.

The US Federal Reserve last month announced a new bond purchase plan of purchasing agency mortgage-backed securities (MBS) at a pace of $40 billion per month, which directly dragged down the fix mortgage rates.