Happy New Year! The mortgage rates continue to fall as 2015 rolls around the bend. These low rates are sending potential home buyers back onto the playing field. According to the Mortgage Bankers Association, mortgage applications surged last week. A measure of total loan application volume, also known as the market composite index, increased 14.2%. The refinance index grew 22%, while the purchase index fell 3%.

According to the Freddie Macs' Primary Mortgage Market Survey (PMMS) the average rate on a 30 year fixed rate mortgage has fallen the lowest level seen since May of 2013, hitting an amazing low of 3.63%.

The rates on a 15 year fixed rate mortgage has hit 2.93% with an average 0.7 point. This is down from 2.98% last week and 3.44% last year.

According to Frank Nothaft, vice president and chief economist with Freddie Mac, "Mortgage rates continued to fall, albeit at a slower pace, with the 30-year fixed rate mortgage averaging 3.63 percent this week. Housing starts [PDF] picked up in December coming in at a seasonally adjusted 1.089 million unit pace and beating market expectations. Meanwhile, the drop in energy prices pushed the Producer [PDF] Price Index down 0.3 percent for December and the Consumer [PDF] Price Index fell 0.4 percent."

Freddie Mac collects mortgage rates from lenders across the nation weekly, Monday through Wednesday and as the rates tend to follow long-term Treasury bonds, they are subject to fluctuate significantly, even on a given day. The uneasiness about the global economy has driven investors into putting their money into bonds which is driving the yields down to extremely low levels.

The rates don't include add-on fees, also known as points. One point is the equivalent of 1% of the total amount of the loan.