NEW YORK (CNNMoney) -- Mortgage rates have never been cheaper, with the 30-year rate falling below 4% for the first time in history.
The interest rate on a 30-year fixed-rate loan fell to 3.94% this week, the lowest rate since mortgage giant Freddie Mac (FMCC, Fortune 500) began tracking it. Meanwhile, the average for a 15-year fixed-rate mortgage also hit a record, falling to 3.26%.
"Average 30-year conventional fixed mortgage rates fell below 4% for the first time in history this week following a sharp drop in 10-year Treasuries early in the week as concerns over a global recession grew," said Freddie's chief economist, Frank Nothaft.
Yields on the benchmark 10-year U.S. Treasury bond, which mortgage rates closely track, have been under 2% this week, closing as low as 1.78%.
The dirt-cheap mortgage rates can result in considerable savings for homeowners. Compared with just three months ago, when the 30-year was at 4.60%, borrowers today can save about $40 a month per $100,000 borrowed. That comes to a savings of nearly $14,000 for every $100,000 borrowed over the life of the 30-year loan.
The low rates have done little to boost home buying, however, according to the Mortgage Bankers Association. Their weekly survey of mortgage applications reported a drop in all loans of more than 4%. Purchase loan applications were almost flat and refinance applications fell more than 5%.
"Potential borrowers largely remained on the sidelines, seemingly unimpressed by the lowest (by any measure) mortgage rates since the 1940s," said Mike Fratantoni, MBA's Vice President of Research and Economics.
Some industry insiders remain unimpressed by the relentlessly falling cost of mortgage borrowing.
"Record low rates, blah, blah, blah: We've already heard this," said Keith Gumbinger of HSH Associates, a mortgage information provider. "Other than the price of money, nothing else has happened."
Given the nation's faltering recovery, the turmoil in Europe and the struggling housing market, the downward trend in mortgage rates is natural, according to Gumbinger.
"The lowest mortgage rates come at the bleakest periods," he said. 
| Overnight Avg Rate | Latest | Change | Last Week |
|---|---|---|---|
| 30 yr fixed | 3.80% | 3.80% | |
| 15 yr fixed | 3.09% | 3.11% | |
| 5/1 ARM | 2.65% | 2.69% | |
| 30 yr refi | 3.77% | 3.86% | |
| 15 yr refi | 3.09% | 3.21% |
Today's featured rates:
FedEx's Fred Smith did 2 tours of duty in Vietnam as a Marine. Meet 10 Fortune 500 executives who served in the U.S. military. More
Group of farmers in southern Kansas pool their land to more than double their money from an oil company for their mineral rights. Play
Here are some hot tips if you're going out car-shopping this weekend. More
This 150-square-foot home can be shipped anywhere and then assembled like Ikea furniture. More
Many Class of 2012 grads find themselves without work. But those who landed jobs say internships are key. More
.
