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| Adjustable-rate loans improved, as did refinance applications. But purchase applications were lower.
The average 30-year fixed-rate mortgage was 5.88%, according to Freddie Mac’s survey of 125 thrifts, commercial banks and mortgage lending companies for the week ending April 17. The 30-year was unchanged from the prior week but lower than 6.17% a year earlier. The 15-year fixed-rate averaged 5.40%, off two basis points from the prior week, Freddie said. The 10-year Treasury yield, considered a benchmark for fixed mortgage rates, was 3.72% this morning according to CNNMoney, 20 BPS higher than a week ago. Banrate.com reported that of the 100 panelists it surveyed for the week April 17 to April 23, 46 projected rising rates over the next 35 to 45 days, while the rest were evenly split over whether rates would fall or remain unchanged. The 5-year hybrid Treasury-indexed adjustable-rate mortgage averaged 5.48% in Freddie’s latest survey, falling from 5.56% the prior week. The 1-year Treasury-indexed ARM averaged 5.10%, also down from the prior week when it averaged 5.18%, Freddie said. Freddie’s chief economist, Frank Nothaft, explained that ARMs were impacted by speculation that the Federal Reserve may soon cut rates again because March housing starts fell to the lowest level since 1991 and also as a result of low consumer sentiment and homebuilder confidence. “Currently, the federal funds future contracts suggest nearly a 100-percent probability that the Fed will cut rates at the end of this month,” Nothaft said. The 1-year Treasury itself, which is used as the index for the 1-year ARM, yielded 1.65% yesterday, climbing from 1.60% a week earlier, according to data from the U.S. Treasury Department. Another ARM index is the 6-month London Interbank Offered Rate, or LIBOR, which Bankrate.com reported at 2.72% yield yesterday, climbing from 2.68% a week earlier. ARMs accounted for 6% of applications tracked in the Mortgage Bankers Association’s Weekly Mortgage Applications Survey for the week ending April 11, down about a half percent from a week earlier. Overall applications edged higher in MBA’s survey, with the Market Composite Index rising to 743.4 from 725.6 the prior week. While purchase applications fell 2%, refinance applications rose 5% and accounted for 54% of total applications, up slightly for the week. |
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Sam Garcia worked in mortgage lending for twenty years prior to becoming publisher of MortgageDaily.com. e-mail:Â mtgsam@aol.com |
