Long-term rates on single-family loans remained at a 10-month low this past week, and the outlook is for an increase during the upcoming week and each of the next five quarters.
At 3.78 percent in Freddie Mac’s Primary Mortgage Market Survey for the week ended Sept. 14, thirty-year fixed rates remained at the lowest they’ve been since the week ended Nov. 10, 2016.
Although long-term mortgages rates
didn’t change from the preceding seven-day period, they were higher than 3.50 percent during the same seven days last year.
The next survey from Freddie should reflect fixed rates that are around 3 BPS more than in this week’s report based on an analysis of Treasury market activity by Mortgage Daily.
Sixty-nine percent of panelists surveyed by Bankrate.com for the week Sept. 13 to Sept. 20 agreed with Mortgage Daily and predicted mortgages rates will increase at least 3 BPS over the next week. No change was expected by 31 percent, and none had rates falling.
The Mortgage Bankers Association predicted in its
September MBA Mortgage Finance Forecast that 30-year fixed rates will rise from an average of 4.0 percent this quarter to 4.2 percent in the fourth quarter and 4.5 percent three months later. In fact, MBA expects fixed rates to increase each quarter through the end of next year.
Interest rates on jumbo mortgages were
3 BPS higher than conforming rates in the U.S. Mortgage Market Index from Mortgage Daily and OpenClose for the week ended Sept. 8. The spread widened from a single basis point in the last report.
In Freddie’s survey, 15-year fixed rates averaged 3.08 percent, no different than in the week ended Sept. 7.
The spread between 15- and 30-year rates was unchanged at 70 BPS.
Freddie said five-year, Treasury-indexed, hybrid, adjustable-rate mortgages averaged 3.13 percent, dipping 2 BPS from the last report.
Interest rates on hybrid ARMs adjust based on the yield on the one-year Treasury note, which was reported at 1.28 percent as of Thursday by the Department of the Treasury. The one-year yield jumped from 1.21 percent seven days earlier.
The six-month London Interbank Offered Rate, which is utilized as an index on some legacy ARMs, was 1.45 percent as of Wednesday, a basis point lower than the previous Wednesday.
ARM share thinned to 10.2 percent in the latest Mortgage Market Index report from 10.5 percent one week earlier.
