There was little movement in fixed rates on residential loans during the past week, and the outlook is for a nice improvement over the next seven days.
On conforming purchase-money mortgages, 30-year fixed rates
averaged 3.80 percent in November, the Federal Housing Finance Agency reported.
Thirty-year rates worsened 4 basis points from a month earlier. FHFA’s survey reflects rates on 4,344 loans closed in the last five days of last month.
In Freddie Mac’s Primary Mortgage Market Survey for just the week ended Dec. 29, thirty-year fixed rates averaged 4.32 percent — the highest they’ve been since they were 4.33 percent in the week ended April 24, 2014.
This week’s rates in Freddie’s survey were 2 BPS more than in the week ended Dec. 22 and 31 BPS higher than a year earlier.
Joe Farr, a director at MBSQuoteline, told Mortgage Daily in a written statement that prices on mortgage-backed securities have improved each of the past couple days. The MBS price improvement is an indication that mortgage rates have declined a little since Freddie’s survey was conducted.
A Mortgage Daily analysis of Treasury market activity points to a 5-basis-point or so decline for fixed rates in Freddie’s next survey.
Half of the panelists surveyed by Bankrate.com for the week Dec. 29 to Jan. 4 predicted mortgage rates won’t move more than 2 BPS over the next week, while the other half expected a decline. None of the panelists projected an increase in rates.
The National Association of Federal Credit Unions predicted in its
NAFCU Economic & CU Monitor: Forecast December 2016 that 30-year mortgage rates will average 3.7 percent for all of 2016 and 4.2 percent in 2017.
Interest rates on jumbo mortgages were
the same as conforming rates in the U.S  Mortgage Market Index report from Mortgage Daily and OpenClose for the week ended Dec. 23. A week earlier, jumbo rates were 7 BPS more than conforming rates.
At 3.55 percent in Freddie’s most-recent report, 15-year fixed rates were 3 BPS worse than in the previous report.
The spread between 15- and 30-year rates thinned to 77 BPS from 78 BPS the prior week.
Freddie reported that five-year, Treasury-indexed, hybrid, adjustable-rate mortgages averaged 3.30 percent, improving 2 BPS from the last survey.
Data from the Department of the Treasury indicate that the yield on the one-year Treasury note was 0.85 percent as of Thursday, down 2 BPS from seven days earlier.
As is the case with the one-year Treasury yield, the six-month London Interbank Offered Rate is used as an index on some ARMs. LIBOR was reported by Bankrate.com at 1.32 percent as of Wednesday, no different than the prior Wednesday.
The most-recent Mortgage Market Index report had ARM share at 9.5 percent, wider than 7.8 percent one week earlier.
