Fixed rates had a big bounce off last week’s all-time lows and might remain elevated in the next set of reports. But the one-year adjustable-rate mortgage was lower.
Soaring 18 basis points from last week’s record low, the average 30-year fixed-rate mortgage was 4.12 percent in Freddie Mac’s Primary Mortgage Market Survey for the week ended Oct. 13. The 30 year, however, was still 7 BPS better than the same week in 2010.
A better-than-expected employment report was blamed by Freddie’s chief economist, Frank Nothaft, for the rise in rates.
Given no significant economic events, mortgage rates can be expected to at least stay this high through next week’s reports based on the 10-year Treasury yield. The Department of the Treasury reported that the 10-year yield closed at 2.19 percent Thursday, up from 2.01 percent the prior Thursday.
But a majority of panelists surveyed by Bankrate.com for the week Oct. 13 to Oct. 19 see it differently. They predicted that mortgage rates will fall at least 3 BPS over the next week or so, while more than a quarter forecasted a rise and 18 percent saw no changes ahead.
The Mortgage Bankers Association predicted in its monthly outlook that the 30 year will average 4.2 percent this quarter and in the first quarter of next year. But the long-term mortgage will make its way up to 4.7 percent by the end of next year.
Jumbo 30-year mortgages were priced 74 BPS higher than conforming loans in the U.S. Mortgage Market Index report for the week ended Oct. 7 from Mortech Inc. and MortgageDaily.com. The spread widened from 70 BPS a week earlier.
The 15-year fixed-rate mortgage averaged 3.37 percent in Freddie’s report, 11 BPSÂ higher than in the prior survey. But the spread between the 15 year and 30 year widened to 75 BPS from last week’s spread of 68 BPS.
Freddie reported that the average five-year, Treasury-indexed, hybrid ARM was up 10 BPS over the past seven days to 3.06 percent.
The one-year Treasury-indexed ARM averaged 2.90 percent, lower than 2.95 percent last week. The one-year ARM was 3.43 percent this week last year.
The index on the one-year ARM, the yield on the one-year Treasury note, inched up to 0.11 percent today from 0.09 percent last Thursday according to Treasury Department data.
Bankrate.com reported that the six-month LIBORÂ climbed to 0.59 percent Wednesday from 0.57 percent seven days prior.
ARM share declined to 4.94 percent in the latest Mortgage Market Index report from the previous week’s 5.48 percent.
MBA has ARM share at 4 percent for the entire second-half 2011, then going form 5 percent in the first half of next year to 6 percent in the second half.
