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Refis Resist Record Rates

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A new record low for the 30-year mortgage wasn’t enough to spark an increase in new loan activity, with refinances retreating.

The average 30-year fixed-rate mortgage eased 1 basis point from last week to 4.57 percent in Freddie Mac’s Primary Mortgage Market Survey for the week ended July 8. The 30-year is at its lowest level since Freddie began tracking it 39 years ago. The 30-year was 5.20 percent 12 months ago.

In the Mortech-MortgageDaily.com Mortgage Market Index report for the week ended July 7, the conventional 30-year moved from 4.546 percent a week earlier to 4.519 percent. The jumbo 30-year, however, moved up 0.01 percent to 5.50 percent, fattening the jumbo spread to 98 BPS from 94 BPS a week prior.

The 10-year yield was 3.025 percent during trading today, rising from 2.96 percent seven days ago, based on data from the U.S. Department of the Treasury and WSJ.com. The 10-year movement points to higher rates in next week’s reports.

A majority of Bankrate.com panelists forecasted no change in mortgage rates during the week July 8 to July 14, while one-third predicted an increase of at least 3 BPS and 11 percent expected rates to fall.

Freddie reported that the average 15-year fixed-rate mortgage inched up 3 BPS from last week to 4.07 percent.

Falling 4 BPS, the five-year Treasury-indexed hybrid adjustable-rate mortgage came in at 3.75 percent in Freddie’s report.

The biggest decline, 5 BPS, occurred with the one-year Treasury-indexed ARM, which averaged 3.75 percent in Freddie’s survey. A year ago, the one-year averaged 4.82 percent. The Treasury reported that the yield on the one-year Treasury closed yesterday at 0.31 percent, just below 0.32 percent a week earlier.

The six-month London Interbank Offered Rate, or LIBOR, was 0.74 percent yesterday, Bankrate.com reported, off from 0.75 percent last week.

ARMs accounted for 5.4 percent of applications in the Mortgage Bankers Association’s Mortgage Applications Survey for the week ended July 2, a bigger share than 4.7 percent in the previous survey. The increase in ARM share came despite that last week, the 30-year fell 11 BPS and the one-year ARM rose 3 BPS.

Mortgage activity, which reflects pricing inquiries by mortgage broker customers of Mortech Inc., fell 19 percent over the past week, with the Mortgage Market Index ending at 286.

The average U.S. loan amount declined to $217,645 from last week’s $222,272, the Mortgage Market Index report indicated. The $282,087 average in Massachusetts was the highest of any state, while South Dakota’s $152,091 was the lowest.

Total refinance share eased to 59 percent from 61 percent in the Mortech-MortgageDaily.com report. This week’s total reflected 46 percent for rate-term refinances and 14 percent for cashout refinances.

The refinance share last week increased to 79 percent from 77 percent in MBA’s survey, pushing refinance applications up 9 percent and overall seasonally adjusted applications 7 percent higher. Purchase activity fell 2 percent and was off more than a third from a year ago.

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