After slowly rising for three consecutive weeks, mortgage interest rates fell sharply to a 59-year low following the announcement of the Federal Reserve's plan to drive down interest rates, according to a report from Freddie Mac
The report said that the average interest rate on a standard 30-year fixed-rate mortgage for the week ending on November 11 was just 4.17 percent, down from 4.24 percent the week before and 4.91 percent during the same week in 2009. Rates for 15-year FRMs also reached a new record low of 3.57 percent.
The low interest rates reduce borrowers' monthly payments, making it easier for moving families to get a mortgage for a new home. However, Frank Nothaft, vice president and chief economist at Freddie Mac, said that high unemployment and tighter lending requirements are keeping home sales depressed.
Moving families who are able to qualify for a loan also have a wider-than-normal selection of available homes. According to the National Association of Realtors
, there were more than 4 million available homes in September, representing a 10.7-month supply at the current sales pace. A six-month supply is generally considered to be a balanced market.