by JANNA HERRON - Nov. 11, 2010 08:57 AM
AP Real Estate Writer
NEW YORK - Rates on fixed mortgages dropped to their lowest levels in decades this week after the Federal Reserve unveiled a massive bond-buying program to help spur economic growth.
Mortgage buyer Freddie Mac said Tuesday the average rate for 30-year fixed loans fell to 4.17 percent from 4.24 percent last week. That's the lowest on records dating back to 1971.
The average rate on 15-year fixed loans fell to 3.57 percent from 3.63 percent. That's the lowest since the survey began in 1991.
The Fed detailed plans last week to buy $600 billion in Treasury bonds. On Wednesday, the central bank gave more details, saying it plans to purchase $105 billion in Treasurys over the next month. The extra demand means Treasurys will produce lower yields for investors. Mortgage rates tend to track those yields.
Mortgage rates have been at or near historic lows since April as investors, concerned about the health of the global economy, shift their money into Treasurys, pushing down rates on the bonds and consumer and business loans.
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