While mortgage rates dropped just three basis points this past week, Wednesday's stock market sell-off could drive them even lower going forward, according to Freddie Mac.

The 30-year fixed-rate mortgage averaged 4.02% for the week ending May 18, down from last week when it averaged 4.05%. A year ago at this time, the 30-year fixed-rate mortgage averaged 3.58%.

"The 30-year mortgage rate fell 3 basis points this week. However, this week's survey closed prior to Wednesday's flight to quality. The delayed impact of the associated decline in Treasury yields may push mortgage rates lower in next week's survey," said Sean Becketti, chief economist at Freddie Mac.

Yields for the 10-year Treasury note fell 11 basis points on May 17 to 2.22%. Those yields dropped another four basis points early Thursday morning before rebounding to 2.21% by 11:13 a.m.

The 15-year fixed-rate mortgage averaged 3.27%, down from last week when it averaged 3.29%. A year ago at this time, the 15-year averaged 2.81%.

The five-year Treasury-indexed hybrid adjustable-rate mortgage averaged 3.13%, down from last week when it averaged 3.14%. At this time last year, it averaged 2.8%.

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Glenn McCullom

Glenn McCullom

Glenn McCullom is the copy editor of National Mortgage News.