Economic worries have sent mortgage rates plummeting to their lowest levels since September 2005, according to Bankrate.com.
The rate on 30-year fixed mortgages dropped to 5.88 percent, down from 6.14 percent last week, while the rate on 15-year fixed rate fell to 5.45 percent, down from 5.76 percent last week. A five-year adjustable rate mortgage slipped to 5.81 percent, down from 6.14 percent a week ago.
Mortgage rates have sank nearly a half percentage point since Christmas, the biggest two-week decline since May 1995. Weak economic indicators, such as declining new home sales and a disappointing employment report, contributed to the decline.
When people are worried about the economy, they flee to safer investments such as Treasury securities. This pushes down the Treasury rates, which in turn sends fixed-rate mortgage rates tumbling.