Freddie Mac: Mortgage rates down again; 30-year averaging 4.12%

Fixed mortgage rates declined for the fifth straight week, with Freddie Mac reporting that lenders were offering 30-year home loans at an average of 4.12%, down from 4.14% a week earlier.

The average offering rate for a 15-year fixed loan fell to 3.21% from 3.25%, Freddie Mac said in its weekly report, released Thursday morning.

The rates were the lowest so far in 2014, defying the expectations of economists, who had expected the 30-year rate to rise to 5% this year.

Borrowers are benefiting from a rush of investors into the bond market, where strong demand for Treasury securities is driving interest rates down. Ten-year Treasury notes are a benchmark for long-term mortgage rates.

With inflation at bay amid sputtering growth in the economy, the yield on 10-year Treasuries has slipped from a recent high of 2.8% on April 2 to less than 2.5%.

The 10-year yield closed at 2.44% Wednesday and was sinking still lower early Thursday.

Mortgage rates fluctuate daily. Freddie Mac, formally known as the Federal Home Loan Mortgage Corp., asks lenders early each week about the terms they are offering to solid borrowers with 20% down payments or equivalent home equity if they are refinancing their loans.

The borrowers would pay less than 1% of the loan amount in upfront fees and discount points; third-party charges for services such as appraisals are not included.

It’s possible to obtain a lower rate by paying additional points, or to get a zero-cost loan by accepting a higher rate.