Mortgage Daily Logo

Rates Increase But Could Retreat

Rates

Interest rates on residential loans turned higher this past week. But current market conditions suggest mortgage rates could be lower in the next report.

In Freddie Mac’s Primary Mortgage Market Survey for the week ended July 16, thirty-year fixed rates averaged 4.09 percent.

The 30 year climbed five basis points from the previous week but has declined by four basis compared to a year earlier.

Freddie Mac Chief Economist Sean Becketti attributed the rise from the last report to volatility emanating out of Greece.

“The crisis in Greece continues to generate volatility in U.S. Treasury yields,” Becketti said in the report. “The tentative agreement hammered out last weekend gave investors the confidence to pull back a bit from Treasuries.”

Joe Farr, director at MBSQuoteline, said rates have eased since Freddie conducted its survey.

“MBS prices have improved  since the Freddie survey was conducted, so the rate Freddie shows as of the 16th is a little higher than it would be if the survey had been taken on the 16th,” Farr explained in a written statement.

In its Origination Insight report for June, Ellie Mae Inc. reported that 30-year fixed rates averaged 4.118 percent in June, rising from 4.013 one month earlier.

On conventional mortgages, the 30 year averaged 4.218 percent in June according to Ellie, while it was just 4.047 percent on loans insured by the Federal Housing Administration and only 3.871 percent on mortgages guaranteed by the Department of Veterans Affairs.

Mortgage Daily’s analysis of Treasury market activity indicates that fixed rates could be around four BPS lower in Freddie’s next report.

Half of the panelists surveyed by Bankrate.com for the week July 16 to July 22 predicted mortgage rates won’t move more than two BPS over the next week or so. Another 36 percent forecasted an increase, and just 14 percent projected a decline.

Interest rates on jumbo mortgages were 17 BPS less than conforming rates in the U.S. Mortgage Market Index report from OpenClose and Mortgage Daily for the week ended July 10. The jumbo-conforming spread widened from a negative 13 BPS the previous week.

Fifteen-year mortgages experienced a five-basis-point week-over-week increase to 3.25 percent, Freddie said. The spread between 15- and 30-year rates was 84 BPS, the same as in the last survey.

Ellie’s report indicated that 15-year loans accounted for 9.7 percent of originations in June, off from 9.8 percent in May.

Freddie reported
that five-year, Treasury-indexed, hybrid, adjustable-rate mortgages averaged 2.96 percent, three BPS more than in the week ended July 9.

One-year Treasury-indexed ARMs averaged 2.50 percent in Freddie’s survey, the same as seven days prior. One-year ARMs, however, have risen 11 BPS from the week ended July 17, 2014.

The one-year Treasury yield, which determines rate and payment changes on one-year ARMs, rose to 0.29 percent Thursday from 0.25 percent a week prior, according to Treasury Department data.

A less-utilized ARM index, the six-month London Interbank Offered Rate — or LIBOR — climbed to 0.46 percent Wednesday from
0.44 percent one week prior, Bankrate.com reported.

ARMs accounted for 4.9 percent of June’s mortgage production, Ellie said. ARM share widened from 4.7 percent the previous month.

ARM share was 9.6 percent in the latest Mortgage Market Index report, narrowing from 11.3 percent the prior week.

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 paperwork has 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 furniture need to...

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...

Newsletter

Don’t worry, we don’t spam