The 30-year mortgage has fallen more than 90 basis points this year and rolls into 2012 near its lowest level on record, and it looks like the first week of the new year could see a further improvement.
Even after rising 4 basis points from last week, the average 30-year fixed-rate mortgage still finished near its all-time low. Freddie Mac reported the 30 year at 3.95 percent in its Primary Mortgage Market Survey for the week ended Dec. 29. The 30-year mortgage was 4.86 percent during the same week last year.
Mortgage rates have some room to decline and could be down around 7 BPS by the next set of reports based on an analysis of Treasury market activity. The yield on the 10-year Treasury note averaged 1.98 percent on Tuesday and Wednesday when Freddie was conducting its weekly survey based on data released by the Department of the Treasury. The 10-year yield, however, fell to 1.91 percent today.
But rates can be expected to stay where they are based on a majority of panelists surveyed by Bankrate.com for the week Dec. 29 to Jan. 4. Just under a quarter each predicted that rates will rise at least 3 BPS or fall.
Based on the U.S. Mortgage Market Index report for the week ended Dec. 23 from Mortech Inc. and Mortgage Daily, jumbo mortgages were priced 75 BPS higher than conforming loans. The jumbo-conforming spread was 74 BPS in the previous report.
The 15-year fixed-rate mortgage climbed to an average of 3.24 percent from 3.21 percent in Freddie’s previous survey. Fifteen-year mortgages were priced 71 BPS better than 30-year loans this week, improving from a 70-basis-point spread in the prior survey.
Freddie reported the five-year, Treasury-indexed, hybrid, adjustable-rate mortgage at 2.88 percent this week, up 3 BPS from last week.
The smallest increase was recorded with the one-year, Treasury-indexed ARM, which Freddie said rose 1 basis point from last week to 2.78 percent. The one year was 3.26 percent a year earlier.
The index for the one-year ARM, the yield on the one-year Treasury note, has been unchanged during the past five trading sessions at 0.12 percent based on Treasury Department data.
It was the first time since Sept. 14 that the six-month London Interbank Offered Rate did not move higher. Bankrate.com said LIBORÂ was unchanged from last Wednesday at 0.80 percent.
ARM share slipped to 5.33 percent from 5.40 percent in the latest Mortgage Market Index report.
