Industries Banking/Finance

Mortgage rates sink with economic concerns

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Mortgage rates dropped a full tenth of a percentage point this week over concerns about U.S. unemployment and European debt.

The average 30-year, fixed-rate mortgage fell to 4.12 percent, compared with 4.22 percent last week, according to McLean-based Freddie Mac. This marks the lowest average rate since Freddie Mac began its weekly survey of mortgage rates in 1971.

A year ago, the average rate was 4.35 percent.

The 15-year, fixed-rate mortgage averaged 3.33 percent, compared with 3.39 percent last week.

“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,” Frank Nothaft, chief economist at Freddie Mac, said in a statement. “On net, the economy added no new jobs last month and was the weakest reading since September 2010. Meanwhile, the unemployment rate remained at 9.1 percent, marking its 31st consecutive month of being above 8 percent, the longest such stretch in 70 years.”

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