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Mortgage rates plumb new depths

Economic fears have investors snapping up bonds, MBS

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Mortgage rates moved deeper into uncharted territory this week, as fear of a double-dip recession prompted investors to flee to the relative safety of long-term bonds and other conservative investments, including mortgage-backed securities that fund most mortgage lending.Rates on 30-year fixed-rate mortgages averaged 4.36 percent with an average 0.7 point for the week ending Aug. 26, down from 4.42 percent last week and 5.14 percent a year ago. That's a low in records dating back to 1971, Freddie Mac said in releasing the results of its weekly Primary Mortgage Market Survey on Thursday."Existing-home sales plunged 27 percent in July, while new homes fell 12 percent to a new all-time record low, which led to some market concerns that the housing market may slow the economic recovery," said Amy Crews Cutts, Freddie Mac's deputy chief economist, in a statement."As a result, long-term bond yields fell to the lowest levels since January 2009, allowing fixed mortgage rates to ...