The average interest rate for a 15-year fixed-rate mortgage hit a new historic low on Friday -- 4.20 percent, down slightly from 4.21 last week. The last time the 15-year rate was that low was August 1991, when Freddie Mac began its weekly survey.

It was the third week in a row that the rate hit a benchmark low.

Monthly payments are higher on 15-year fixed-rate mortgages than on 30-year fixed-rates, but for buyers who wish to be mortgage-free sooner, now may be the time to jump.

Rates this low might not last for long -- really!
If you're sure you won't be in the home you're buying or refinancing longer than five years, you may want to save some interest by taking advantage of a 5-year adjustable-rate mortgage. Five-year ARMs also fell to a historic low average rate, from 3.97 to 3.94 percent.

Average rates on a 30-year fixed went up slightly from 4.78 to 4.79, but they are still near their historic low. The interest rate on a 1-year adjustable-rate mortgage remained unchanged at 3.95, but borrowers should not even consider this rate right now with long-term fixed rates so low.

While most economists expected mortgage interest rates to move upward when the Federal Reserve stopped buying mortgage backed assets in March, they've moved in the opposite direction. Instead of going up, the rates have continued their downward march.

The exceptionally low interest rates may help stabilize the housing market, which has crashed somewhat since the home buyer tax credit expired on April 30.

Last year, interest rates were about 1 percent higher. With housing prices near bottom and interest rates at historic lows, now would be a great time to buy a house.

"Rates have unexpectedly returned to near 50-year lows due to the overseas mess, but it's worth noting that such sudden declines have proven fleeting in the past," said Keith Gumbinger, vice president of consumer loan information firm HSH Associates.