For the week ending Oct. 1, 30-year fixed mortgages averaged 4.94% with an average 0.7 point, down 10 basis points from last week, according to Freddie Mac

Rates were last below 5% in late May when they averaged 4.91%. Their record low was 4.78% reached in early April and again in early May.

Despite mortgage rate levels, refinancing activity has been muted as demonstrated by yesterday's report from the Mortgage Bankers Association (MBA) for the week ending Sept. 25. 

The MBA reported mortgage rates also below 5%, but the Refinance Index held relatively flat at 2859 from 2882 in the previous week. 

Credit Suisse analysts said that the Refinance Index levels were 50% to 60% higher in mid-May when rates were at comparable levels as current. 

In other lending programs, 15-year fixed mortgage rates also tumbled 10 basis points to 4.36%, 5/1 Hybrid ARMs were 9 basis points lower to 4.42%, while one-year ARM rates averaged 4.49% compared to 4.52% last week. 

For the month of September, the 30-year fixed mortgage rate averaged 5.03%, down 16 basis points from August's average. 

Meanwhile, through Sept. 25, the MBA Refinance Index has averaged 2712, 32% higher. As such, modest increases are projected in prepayments for October (reported in November). 

Partially offsetting is a lower day count of 20 days from 21 in September. Speeds are expected to increase 5% with the largest percentage increases in 5s and 5.5s.

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