Mortgage rates retreated for the second week in a row, according to the latest data released Thursday by Freddie Mac.

Concern over the global economy is fueling volatility in the financial markets and pushing down rates on home loans. The 10-year Treasury yield closed at a two-month low on Wednesday. The movement of the 10-year Treasury bond is one of the best indicators whether mortgage rates will rise or fall. When yields go down, interest rates tend to go down.

The 30-year fixed-rate average dropped to 3.92 percent with an average 0.6 point, its lowest level since early November. (Points are fees paid to a lender equal to 1 percent of the loan amount.) It was 3.97 percent a week ago and 3.66 percent a year ago.

The 15-year fixed-rate average fell to 3.19 percent with an average 0.5 point. It was 3.26 percent a week ago and 2.98 percent a year ago.

The five-year hybrid adjustable rate average sank to 3.01 percent with an average 0.4 point. It was 3.09 percent a week ago and 2.9 percent a year ago.


“Long-term Treasury yields continue to drop, dragging mortgage rates down with them,” Sean Becketti, Freddie Mac chief economist, said in a statement.


“Turbulence in overseas financial markets is generating a flight-to-quality which benefits U.S. Treasury securities. In addition, sagging oil prices are capping inflation expectations.”

Meanwhile, mortgage applications rebounded from their holiday slump, according to the latest data from the Mortgage Bankers Association.

The market composite index — a measure of total loan application volume – soared 21.3 percent from the previous week. The refinance grew 24 percent, while the purchase index increased 18 percent.


The refinance share of mortgage activity accounted for 55.8 percent of all applications.

“MBA’s purchase mortgage application index reached its second highest level since May 2010 on a seasonally adjusted basis last week, second only to the week prior to the implementation of the Know Before You Owe rules,” Lynn Fisher, MBA’s vice president of research and economics, said in a statement.

“Bolstered by strong fourth quarter growth in jobs and continuing low rates, the results are similar to levels we saw in early December, suggesting that the purchase market’s strong finish to 2015 may be continuing.  While refinances also increased on a holiday-adjusted basis, refinance activity was down 38 percent relative to a year ago when rates dove below 4 percent.”