Average US 30-year mortgage rate slips to 4.02 percent

Long-term U.S. mortgage rates inched lower this week. It was the fifth straight week that the benchmark 30-year rate hovered around the key threshold of 4 percent.

Mortgage buyer Freddie Mac said Thursday the average rate on 30-year fixed-rate home loans slipped to 4.02 percent from 4.05 percent last week. The rate stood at 3.58 percent a year ago and averaged 3.65 percent in 2016, the lowest level in records dating to 1971.

The rate on 15-year mortgages eased to 3.27 percent from 3.29 percent last week.

Amid growing worries that deepening political turmoil in Washington will hinder President Donald Trump's plans to enact tax cuts and other business-friendly policies, the stock market had its steepest drop since September on Wednesday. Bond prices rose as investors shunned riskier assets. That depressed the yields on long-term Treasury bonds, which mortgage rates tend to follow.

"Political drama in Washington prompted mortgage rates to fall as investors scale back their expectations for the passage of legislation that might boost economic growth," said Svenja Gudell, chief economist at real estate data provider Zillow. "Expectations for slower economic growth could translate into a slower pace of interest rate hikes by the Federal Reserve in the months ahead."

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 percent of the loan amount.

The average fee for a 30-year mortgage was unchanged this week at 0.5 point. The fee on 15-year loans also held steady at 0.5 point.

Rates on adjustable five-year loans declined to 3.13 percent from 3.14 percent last week. The fee remained at 0.5 point.