Mortgage Daily Logo

Activity Rises as Fixed Rates Fall to Record Lows

Rates

Fixed mortgage rates fell to a record low, mortgage activity improved and the average mortgage loan amount increased. But the jumbo spread deteriorated further.

In its Primary Mortgage Market Survey for the week ended June 24, Freddie Mac reported the average 30-year fixed-rate mortgage at 4.69 percent, falling from the prior week’s 4.75 percent. The 30-year was 5.42 percent a year earlier.

It was the lowest level on record since April 1971 — when the secondary mortgage lender began collecting data on 30-year mortgage rates.

The conventional 30-year moved 11 BPS lower to 4.652 percent in the Mortech-MortgageDaily.com Mortgage Market Index for the week ended June 23. At the same time, the jumbo 30-year fell 9 BPS to 5.590 percent — causing the conventional-jumbo spread to widen to 94 BPS from last week’s 92 BPS. It was the third consecutive week of deterioration for the jumbo spread.

Freddie’s secondary rival, Fannie Mae, predicted that the 30-year will average 5.0 percent each quarter of 2010.

Freddie’s and Fannie’s regulator, the Federal Housing Finance Agency, reported that the conforming 30-year rate averaged 5.12 percent in May, the same as in April.

The yield on the 10-year Treasury bond was 3.126 percent during trading today, sinking from 3.21 percent a week prior, based on data from the U.S. Department of the Treasury and WSJ.com. The movement offers little direction about where rates will land next week.

Bankrate.com reported that the majority of its panelists for the week June 24 to July 3 expected no changes in mortgage rates over the next week. But more than a third projected an increase of at least 3 BPS, and 10 percent forecasted a decline.

The average 15-year fixed-rate mortgage fell 7 basis points from Freddie’s prior survey to 4.13 percent — the lowest level on record since the McLean, Va.-based firm began tracking the 15-year in September 1991. The FHFA said the 15-year averaged 4.58 percent last month, 6 BPS worse than April.

Down 5 BPS for the week, the five-year Treasury-indexed hybrid adjustable-rate mortgage came in at 3.84 percent — the lowest point since Freddie started surveying lenders about the five-year in January 2005.

While the one-year Treasury-indexed ARM also fell 5 BPS, to 3.77 percent, it had been lower in the May 6, 2004, survey at 3.76 percent. A year ago, the one-year stood at 4.93 percent. Fannie has the one-year averaging 4.1 percent in the second and third quarters, lower than the first quarter’s 4.3 percent.

The Treasury reported that the yield on the one-year Treasury bill — the underlying index for the one-year ARM — was 0.30 percent yesterday, unchanged from seven days earlier. The yield on the six-month London Interbank Offered Rate, which is used as an index on many subprime ARMs, was also unchanged — coming in at 0.75 percent.

ARM activity declined to 4.9 percent in the Mortgage Bankers Association’s Weekly Mortgage Applications Survey for the week ended June 18 from 5.2 percent the prior week. The lower share came despite that the one-year ARM fell 9 BPS last week even as the 30-year was 3 BPS higher.

An uptick in mortgage activity was reported in the Mortgage Market Index, which climbed to 274 from 257 last week. The average U.S. loan amount also increased, to $215,847 from $211,982. The highest average was Washington, D.C.’s, $306,728, and the lowest was Nebraska’s $155,125.

Refinance activity rose to 51 percent from the previous week’s 49 percent in the Mortech-MortgageDaily.com report. The share of rate-term refinances was 38 percent, while the cashout refinance share was 13 percent.

MBA said that a week earlier, overall applications fell 6 percent on a seasonally adjusted basis. Refinances fell 7 percent, squeezing the refinance share to 74 percent from the previous week’s 75 percent. Purchase applications fell just 2 percent.

Related Posts

Mortgage Rates Up 92 BPS From Year Ago

Mortgage Rates Up 92 BPS From Year Ago

Over the past year, weekly fixed interest rates on single-family loans have soared 92 basis points. But little change was reported from last week, and more of the same is expected. On conventional loans utilized to finance a home purchase with amounts up to the...

Mortgage Rates Up 92 BPS From Year Ago

Mortgage Rate Forecasts Have Little Change Ahead

Thirty-year mortgage rates moved lower this past week and this past month. Short- and long-term forecasts have little movement ahead for mortgage rates. Ellie Mae Inc.'s Origination Insight Report | September 2018 indicated that average 30-year note rates on...

Mortgage Rates Up 92 BPS From Year Ago

Mortgage Rates Soar, Could Sink in Next Report

An expected surge in mortgage rates came to fruition this week. The latest forecast has fixed rates tumbling in next week's report. A new index for adjustable-rate mortgages moved lower. A stunning 19-basis-point surge from the preceding week left average 30-year...

Mortgage Rates Up 92 BPS From Year Ago

Mortgage Rates Dip, But Likely to Skyrocket

Mortgage rates retreated a modest amount just one week after climbing to a seven-year high. The next rate report, however, is likely to reflect significant escalation. Prospective 30-year borrowers using the LendingTree network during September were offered an average...

Mortgage Rates Up 92 BPS From Year Ago

Mortgage Rates Little Changed, More of Same Ahead

Over the past week, there was little change in interest rates on home loans. During the next week, more of the same is likely. Recently rising rates have helped the Federal Home Loan Banks' earnings. Conventional mortgages with conforming loan amounts used to finance...

Popular posts

How Long Does It Take to Refinance a Mortgage
How Long Does It Take to Refinance a Mortgage

So, you’re interested in refinancing your mortgage. Maybe you want some extra capital to do that home project you’ve always dreamed of, interest rates are nearing record lows, or you want to start consolidating debt. Regardless of the motivation behind the refinance,...

How Does Refinancing a Mortgage Work
How Does Refinancing a Mortgage Work

A home purchase is considered an investment, and a robust one at that. Savvy owners are constantly looking for new ways to reduce debt, save money, pay less in interest, and ultimately build equity. Refinancing is one way to leverage your investment and do just that....

What Does It Mean to Refinance Your Home
What Does It Mean to Refinance Your Home

You can think of refinancing your mortgage as a debt redo. Essentially, you’ll swap out the existing loan for a new one - ideally with better terms and conditions. Only this time it could help you save money on high mortgage payments, rather than just borrow it....

Setting up the Utilities in My New House
Setting up the Utilities in My New House

All the tedious, time-consuming home closing documents have been signed, sealed, and delivered. Your belongings are packed into what seems like a million boxes and you have a solid plan to haul all your existing furniture to the new place. Just as your boxes and...

When Is My First Mortgage Payment Due?
When Is My First Mortgage Payment Due?

Navigating your way through a brand new mortgage loan can be a difficult task, especially for first time homeowners. After handing over a large sum of money for the down payment and closing costs, it’s important to pay attention to the timing of your first mortgage...

Newsletter

Don’t worry, we don’t spam

calculate your monthly mortgage payment

Related Topics

Helpful Links

Daily mortgage rate trends

Best mortgage lenders

First-time homebuyers programs by state

Loan limits by state

Types of mortgages

APR vs interest rate

Understanding PMI