08/14/2014 02:07 EDT | Updated 10/14/2014 05:12 EDT

Average US rate on 30-year mortgage slips to 4.12 per cent; rate on 15-year loan 3.24 per cent

WASHINGTON - Average long-term U.S. mortgage rates declined this week, approaching their lows for the year.

Mortgage company Freddie Mac said Thursday the nationwide average for a 30-year loan slipped to 4.12 per cent from 4.14 per cent last week. The average for a 15-year mortgage, a popular choice for people who are refinancing, fell to 3.24 per cent from 3.27 per cent last week.

Mortgage rates are below the levels of a year ago. They have fallen in recent weeks after climbing last summer when the Federal Reserve began talking about reducing the monthly bond purchases it was making to keep long-term borrowing rates low.

Mortgage rates often follow the yield on the 10-year Treasury note. The 10-year note traded at 2.42 per cent Wednesday, brushing its low for the year of 2.41 per cent and down from 2.47 per cent a week earlier. It fell to 2.38 per cent in trading Thursday morning.

At 4.12 per cent, the rate on a 30-year mortgage is down from 4.53 per cent at the start of the year. Rates have fallen even though the Fed has been trimming its monthly bond purchases, which are intended to keep long-term borrowing rates low. The purchases are set to end in October.

To calculate average mortgage rates, Freddie Mac surveys lenders across the country between Monday and Wednesday each week. The average doesn't include extra fees, known as points, which most borrowers must pay to get the lowest rates. One point equals 1 per cent of the loan amount.

The average fee for a 30-year mortgage was 0.6 point, down from 0.7 point last week. The fee for a 15-year mortgage was unchanged at 0.6 point.

The average rate on a five-year adjustable-rate mortgage edged down to 2.97 per cent from 2.98 per cent. The fee remained at 0.5 point.

For a one-year ARM, the average rate rose to 2.36 per cent from 2.35 per cent. The fee was stable at 0.5 point.