Pricing on residential financing products was better this past week, and all of the latest indications are that they will be similar in the next rate report.
Thirty-year fixed rates were
4.12 percent in the week ended Jan. 12, according to the Primary Mortgage Market Survey reported by Freddie Mac.
The average improved compared to the previous week, when the 30 year landed at 4.20 percent. It was the second consecutive week that rates fell.
But long-term rates worsened from 3.92 percent a year previous.
“After absorbing a mixed December jobs report, the 10-year Treasury yield fell 8 basis points,” Freddie Mac Chief Economist Sean Becketti said in the report.
Since the secondary lender conducted its survey, prices on mortgage-backed securities have improved further, as have mortgage rates, MBSQuoteline Director Joe Farr said in a written statement.
An analysis of movement in the 10-year Treasury yield by Mortgage Daily indicates that interest rates won’t be much different in the next report from Freddie, possibly slightly lower.
A majority of panelists surveyed by Bankrate.com for the week Jan. 12 to Jan. 18 seemed to be in line with Mortgage Daily’s forecast and predicted that rates won’t change more than 2 BPS over the next week. Over a quarter projected a decline, and 18 percent expected an increase.
A forecast from the American Bankers Association’s Economic Advisory Committee has 10-year Treasury yields
rising 60 BPS from now through the end of 2018.
In the U.S Mortgage Market Index report from OpenClose and Mortgage Daily for the week ended Jan. 6, jumbo rates were 4 BPS less than conforming rates, the same spread as of a week earlier.
Freddie’s survey indicated that 15-year fixed rates averaged 3.37 percent, dropping by 7 BPS from the week ended Jan. 5, 2017. The spread between 15- and 30- rates
thinned to 75 BPS from 76 BPS last week.
Five-year, Treasury-indexed, hybrid, adjustable-rate mortgages averaged 3.23 percent in Freddie’s latest report, down 10 BPS from one week prior.
Hybrid ARMs adjust based on the one-year Treasury note yield, which fell to 0.81 percent Thursday from 0.83 percent seven days earlier, the Treasury Department reported.
At 1.33 percent as of Wednesday, the six-month London Interbank Offered Rate
was modestly higher than 1.32 percent the previous Wednesday, according to Bankrate.com.
The latest Mortgage Market Index report had ARM share at 7.6 percent, wider than 6.9 percent in the week ended Dec. 30, 2016.
