NEW YORK (CNN/Money) -
Mortgage rates dropped after last week's softer-than-expected August jobs report indicated an ongoing jobless economic recovery and pumped some life into U.S. Treasury prices, pushing yields lower.
The 30-year mortgage rate tumbled to 6.16 percent in the week ending Sept. 12, with an average of 0.6 point payable up front, from 6.44 percent a week earlier. The 30-year stood at 6.18 percent this time last year, according to mortgage finance firm Freddie Mac.
The 15-year fixed-rate mortgage dropped to 5.46 percent from last week's 5.77 percent rate and the 5.59 percent rate of a year ago. The 15-year averaged 0.6 point payable up front.
And the rate on one-year adjustable-rate mortgages (ARMs), loosely indexed to the 10-year Treasury note, fell to 3.87 percent, also with 0.6 point, from 3.98 percent last week, and it's still below the year-ago rate of 4.32 percent.
"The release of the August jobs report showed a continuation of the jobless recovery...this, of course, caused interest rates, including mortgage rates, to ease back from the highest level we had seen in a year," said Frank Nothaft, Freddie Mac chief economist said.
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Freddie Mac's average mortgage rates are based on a survey of 125 lenders nationwide. The rates include those on mortgages accepted by borrowers with good credit ratings who place a 20 percent down payment on their homes, according to Freddie Mac. The total amount of each mortgage considered for the survey doesn't exceed a $322,700 limit.
Freddie Mac (FRE: up $1.05 to $54.45, Research, Estimates), or Federal Home Loan Mortgage Corp., is a publicly traded company the government established in 1970 to provide a flow of funds to mortgage lenders. It buys mortgages from banks, bundles them and then resells them as mortgage-backed securities.
Its products, and the products of other similar entities, have become increasingly popular as an alternative to government-backed bonds, particularly with international investors.
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