30-Year Mortgage Rates Fall to 2010 Lows

Average 30-year mortgage rates dropped for the seventh week in a row to 4.85% according to BestCashCow/Informa data. That's down from the high of 5.20% in early April. Homebuyers and homeowners looking to refinance can thank the European debt crisis for the most recent drop below 5%. European debt fears have sent a wave of cash into Treasuries, driving down the 10 year note. The 10 year note is the benchmark used to set 30 year rates.

Other mortgage rates have also come down. The 15-year fixed rate mortgage dropped to 4.30%, down from a 4.52% in early April. Five-year ARMs are at 3.76% versus 4.05% in early April.

What Does This Mean for Homebuyers?

I've been following actual rates, not just averages for a 30-year fixed rate loan in Massachusetts with 0 points ($200,000 loan) for the past four months. Three weeks ago, the rate shot up to 5.125%. Three weeks ago it was 4.875%. Last week the rate was 4.750%. This week it's 4.625%. Best rates continue to drop along with the averages.

View mortgage rates by state and zip code.