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| Long-term fixed rates have not risen for six consecutive weeks. Loan applications continued to rise, while FHA activity jumped.
Freddie Mac reported that the 30-year fixed-rate mortgage averaged 6.35% in its survey for the week ending Sept. 4, down from 6.40% the prior week. The 30-year has not risen since the week ended July 24. “Mortgage rates eased a bit over the holiday-shortened week following release of economic data that suggest consumer spending may slow,” Freddie’s Chief Economist Frank Nothaft explained in the survey. “The economy grew at an upwardly revised 3.3 percent pace in the second quarter, boosted by the smallest trade deficit in eight years, and residential fixed investment slowed growth by 0.6 percent, the least amount since the same period a year ago.” Last year at this time, the average 30-year was 6.46%. Freddie’s survey indicated the average 15-year fixed rate was 5.90%, off from 5.93% in its survey seven days earlier. More than half — 53% — of the panelists surveyed by Bankrate.com for the week Sept. 4 to Sept. 10 project mortgage rates will rise by at least 3 basis points during the next 35 to 45 days, while 29% forecast a decrease and 18% see no change ahead. Fixed mortgage rates tend to move with the 10-year Treasury yield, which CNNMoney reported at 3.63% this afternoon, tumbling from 3.81% a week prior. The 5-year Treasury-indexed hybrid adjustable-rate mortgage averaged 5.97% this week, falling from 6.03% last week, Freddie said. The average 1-year Treasury-indexed ARM was 5.15%, dropping from 5.33% the prior week, Freddie reported. The 1-year ARM index, the 1-year Treasury yield, was 2.08% yesterday, better than 2.16% one week earlier, according to U.S. Treasury data. The 6-month London Interbank Offered Rate, which is also used as an ARM index, was 3.12% yesterday, Bankrate.com reported. LIBOR was 5 BPS better than the prior week. ARMs accounted for 7% percent of applications tracked by the Mortgage Bankers Association for the week ending Aug. 29, easing from 8% in the prior survey. Total applications taken by mortgage originators increased 8% from the prior week on a seasonally adjusted basis, the second weekly increase, MBA said. The Market Composite Index now stands at 453.1. Purchase applications were up 11% and refinances rose 2 % — bringing the refinance share to 34% compared to 35% the previous week. Government applications, which MBA indicated are largely FHA, climbed 20% from the prior week, rose for the fifth consecutive week and reached their highest level since May 30, 2003, MBA told MortgageDaily.com in a statement yesterday. |
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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 |
