The average conforming 30-year fixed mortgage rate fell to 5.35 percent, according to Bankrate.com's weekly national survey. The average 30-year fixed mortgage has an average of 0.38 discount and origination points.

The average 15-year fixed mortgage was down to 4.61 percent while the larger jumbo 30-year fixed rate plummeted to 6.24 percent. Adjustable rate mortgages were somewhat mixed, with the average 1-year ARM jumping to 5.37 percent and the 5-year ARM sinking to 4.58 percent.

Mortgage rates broke out of their recent range, with the average 30-year fixed mortgage rate falling to a seven-month low of 5.19 percent. With this recent decline, mortgage rates are once again flirting with the record lows seen in the Spring. The drop is only partly due to the weak job market, but also investors repositioning ahead of large government debt auctions. Investors often lighten up on government bonds prior to an auction, and increase exposure to higher-yielding mortgage-backed bonds.

Mortgage rates are more than one full percentage point lower than one year ago. This time last year, the average 30-year fixed mortgage rate was 6.39 percent, meaning a $200,000 loan would have carried a monthly payment of $1,249.70. With the average rate now 5.19 percent, the monthly payment for the same size loan would be $1,096.99, a savings of $152 per month for a homeowner refinancing now.

SURVEY RESULTS

30-year fixed: 5.19% - down from 5.35% last week (avg. points: 0.38)

15-year fixed: 4.61% - down from 4.72% last week (avg. points: 0.30)

5/1 ARM: 4.58% - down from 4.64% last week (avg. points: 0.29)