Mortgage Rates Tumble, Could Stay Down

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MORTGAGE EXPERT
3 · 23 · 17

Prospective home loan borrowers got a break on rates this past week. Odds are rates will stay down or dip a little further in the next report.

In Freddie Mac’s Primary Mortgage Market Survey for the week that ended on March 23, thirty-year fixed rates averaged 4.23 percent.

That was 7 basis points lower than in the previous survey.
But the 30 year still stands well above 3.71 percent as of the same week last year.

Joe Farr, a director at MBSQuoteline, said in a written statement to Mortgage Daily that mortgage rates have improved slightly since Freddie conducted the survey.

A Mortgage Daily analysis of Treasury market activity suggests that fixed mortgage rates are not likely to be much different in the next survey, maybe a couple BPS lower.

A majority of panelists who were surveyed by Bankrate.com for the week March 23 to March 29 agreed with Mortgage Daily and predicted that rates won’t move more than 2 BPS over the next week. A decline was expected by 36 percent, and just 9 percent forecasted an increase.

In the U.S. Mortgage Market Index report from OpenClose and Mortgage Daily for the week ended March 17, interest rates on jumbo mortgages were the same as conforming rates. A week earlier, jumbo rates were a basis point less than conforming rates.

Freddie’s survey had 15-year fixed rates averaging
3.44 percent, improving 6 BPS from the week ended March 16. The spread between 15- and 30-year rates was 79 BPS, thinner than 80 BPS in the last report.

Five-year, Treasury-indexed, hybrid, adjustable-rate mortgages averaged 3.24 percent in Freddie’s survey, declining from 3.28 percent the previous week.

The yield on the one-year Treasury note, which determines rate changes on hybrid ARMs, was 0.99 percent Thursday, according to Treasury Department data. The yield retreated from 1.01 percent seven days earlier.

Bankrate.com reported that the six-month London Interbank Offered Rate, which also serves as an index on some legacy ARMs, was 1.43 percent as of Wednesday. LIBOR
was unchanged from the prior Wednesday.

ARM share was 9.2 percent in the most recent Mortgage Market Index report. ARM share was shaved from 9.3 percent in the previous report.

Author

Mortgage Daily Staff

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