Rate on 30-year mortgage below 4 pct. for 2nd time

The average rate on the 30-year fixed mortgage fell below 4 percent for just the second time in history. Freddie Mac said Thursday the rate on the 30-year fixed loan fell to 3.99 percent, down from 4 percent last week. Five weeks ago, it dropped to a record low of 3.94 percent, according to the National Bureau of Economic Research. The average rate on the 15-year fixed mortgage fell last week to 3.30 percent from 3.31 percent. Five weeks ago, it too hit a record low of 3.26 percent. Mortgage rates track the yield on 10-year Treasury note, which fell this week as investors shifted money into safer Treasurys amid fears Europe's debt crisis could worsen. Low mortgage rates have down little to boost home sales. Rates have been below 5 percent for all but two weeks this year. Yet home sales are on pace to be the lowest in 14 years. High unemployment and declining wages have made it harder for many people to qualify for loans. Many Americans don't want to sink money into a home that could lose value over the next three to four years. And most homeowners who can afford to refinance already have. The low rates have caused a modest boom in refinancing, but that benefit might be wearing off. Most people who can afford to refinance have already locked in rates below 5 percent. Just five years ago they were closer to 6.5 percent. Ten years ago, they were above 8 percent.

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