|30-year Hits Record Low 5.31%, Could Head Higher
Healthy pace of applications
May 30, 2003
By ANNE LINEBERRY
|Mortgage interest rates this week are so low…come on, let’s hear it: “How low are they?”
They’re so low they have to look up to see the bottom of the Mariana Trench. Why, they’re so low, the other interest rates have taken the limbo stick and gone home. They’re so low they make Barry White sound like a soprano. In fact, they’re so low they’re beginning to resemble Nielsen ratings for MSNBC. Ok, they’re not quite that low. Yet.
According to Freddie Mac’s Weekly Mortgage Markey Survey, the average 30-year fixed rate came in at a record 5.31 percent, off three basis points (BPS) from last week. The 15-year rate stayed even with the prior week’s record at 4.73 percent. Discount points stayed under one.
The one-year Treasury indexed adjustable rate mortgage (ARM) rose two BPS, according to Freddie, finishing the week at an average of 3.63 percent.
The ten-year Treasury bond yield zigzagged this week, but closed Thursday at 3.33%, up two BPS from last week’s 3.31%.
Over at Bankrate.com, mortgage experts tallied up an evenly split opinion on where rates were headed; 38 percent say up, 38 percent say down. The rest voted for “undecided.”
Forbes notes that now is the time to buy or refinance. The financial magazine cites experts that point to, among many factors, a friendly consumer-confidence index as an indicator that should influence rates, sending them back up.
Frank Nothaft, chief economist for Freddie Mac, has also predicted an turn upward in rates later this year in his forecasts, as have economists with the Mortgage Banker’s Association of America (MBA).
Speaking of them, their Market Composite Index of mortgage loan applications keeps inching higher. It finished the week ended May 23 at 1634.6, on a seasonally adjusted basis, according to a press release. The purchase index was off slightly, but the seasonally-adjusted refinance index jumped again, finishing at 8840.9, up from 8351.1 the prior week.
The Weekly Mortgage Applications Survey data showed refinances holding the lion’s share of applications, 77.1 percent.
Anne Lineberry is MortgageDaily.com‘s editor. She previously worked as an online editor/producer for DallasNews.com and on the Metropolitan desk for the print edition of The Dallas Morning News. Email Anne at AnneLineberry@MortgageDaily.com
7 Refinance Strategies
Refinance to a lower interest rate: If interest rates have dropped since you took out your original mortgage, refinancing to a lower rate can help you save money on your monthly payments and reduce the overall cost of your loan. Refinance to a shorter loan term:...