Mortgage rates drop again to near-record level

WASHINGTON - Average U.S. rates on fixed mortgages fell this week and are just slightly above record lows reached earlier this year. The low rates have contributed to a modest housing recovery.

Mortgage buyer Freddie Mac said Thursday that the rate on the 30-year loan declined to 3.59 percent, down from 3.66 percent last week. Five weeks ago, the rate fell to 3.49 percent, the lowest since long-term mortgages began in the 1950s.

The average on the 15-year fixed mortgage, a popular refinancing option, slipped to 2.86 percent. That's down from 2.89 percent last week and from the record low of 2.80 percent five weeks ago.

Cheap mortgages are a key reason the housing market is finally started to rebound five years after the bubble burst. Still, many people are still having difficulty qualifying for home loans or can't afford larger down payments required by banks.