Mortgage Rates for 30-Year U.S. Loans Decrease to Four-Month Low of 4.71%

U.S. mortgage rates fell for a third week, sending longer-term borrowing costs to the lowest level since January as the housing market remains sluggish.

The average rate for a 30-year loan dropped to 4.71 percent in the week ended today from 4.78 percent, according to Freddie Mac. That is the lowest since the week ended Jan. 13. The 15- year rate slid to 3.89 percent from 3.97 percent a week ago, the McLean, Virginia-based mortgage-finance company said.

The U.S. housing market is struggling to recover from the worst crash since the Great Depression as unemployment hovers close to 9 percent and mounting foreclosures depress values. Lower mortgage rates are unlikely to boost demand as credit standards get tougher and prices drop, according to Paul Dales, senior U.S. economist at Capital Economics in Toronto.

“Despite the latest fall back in mortgage rates, appetite for mortgage borrowing is still stuck in a rut,” Dales said in a note to clients yesterday. “Widespread negative equity and tight credit conditions mean that many households are unable to get a mortgage even if they wanted one.

The Mortgage Bankers Association’s loan applications index rose 4 percent in the week ended April 29, the Washington-based group said yesterday. The gain was led by an increase in refinancing, which climbed 6 percent. The index measuring purchase applications rose 0.3 percent.

The average rate for a 30-year fixed loan is below where it was last year at this time, when it was 5 percent, according to Freddie Mac. It fell to a record 4.17 percent in November.

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