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| As applications declined, long-term rates briefly retreated from their uphill run.
Down for the first time in six weeks, the average for the 30-year fixed-rate mortgage slipped to 6.58% from last week’s 6.59%, Freddie Mac said its latest survey of 125 mortgage lending thrifts, companies and commercial banks showed. Last year at this time, the average was 0.81% lower. In April, the Mortgage Bankers Association predicted the 30-year would average 6.7% in the last half of the year, but said Tuesday it now sees it averaging 6.8% next quarter and 6.9% by yearend. The 15-year averaged 6.17%, decreasing 5 basis points from last week and widening the spread from the 30-year to 53 BPS, Freddie said. The 10-year Treasury was trading at a 5.15 yield late Thursday. The only weekly increase, by 1 BPS to 6.22%, reportedly occurred with the average 5-year Treasury-indexed hybrid adjustable-rate mortgage. Meanwhile, the average for 1-year Treasury-indexed ARMs fell for the first time in seven weeks to 5.62% from 5.67% seven days ago, according to Freddie’s survey. “Less-than-expected job growth in April helped mortgage rates to level off this week,” said Frank Nothaft, Freddie vice president and chief economist, in an announcement. “Even ARM rates were little affected by the Federal Reserve’s increase in the federal funds rate. However, next week’s release of the April Consumer and Producer Price Indexes may lift mortgage rates higher if the figures show an acceleration in inflation.“ Originators completed 6% less loan applications than a week earlier, mainly due to the 9% downturn in refinance requests, according to MBA’s application survey for the week ending May 5. The refinance share of total mortgage applications dwindled from the prior week to 34%, MBA said, and the ARM share edged up to 29%. |
Coco Salazar is an assistant editor and staff writer for MortgageDaily.com. e-mail: [email protected]
