Fixed rates barely moved this week and remained near all-time lows. But mortgage rates are likely to be much higher in next week’s report following today’s stock market rally.
A 1-basis-point decline from last week had the average 30-year fixed-rate mortgage at 4.10 percent in Freddie Mac’s survey of 125 mortgage bankers for the week ended Thursday. The 30 year was 4.23 percent a year ago.
For all of September, the 30 year averaged 4.56 percent, down 7 BPS from August, according to the Federal Housing Finance Agency.
The 30-year mortgage rate will likely be at least 20 BPS higher in next week’s report based on Treasury market activity today. The yield on the 10-year Treasury note shot up to 2.42 percent today from 2.20 percent last Thursday, according to data delivered by the Department of the Treasury. The steep increase followed news of an agreement to reduce principal owed on Greek bonds and a strong gross domestic product report.
But a plurality of panelists surveyed by Bankrate.com for the week Oct. 27 to Nov. 2 see no changes ahead for the next week. An equal proportion, 29 percent, each predicted rates will either increase or fall at least 3 BPS.
In the market for loans exceeding $417,000, jumbo borrowers paid a 64-basis-point premium for mortgages compared to conforming borrowers, according to the U.S. Mortgage Market Index report from Mortech Inc. and MortgageDaily.com for the week ended Oct. 21. The jumbo-conforming spread fell from 67 BPS last week.
Freddie reported the average 15-year fixed-rate mortgage at 3.38 percent, unchanged over the past seven days. The spread between the 15-year mortgage and the 30 year was 72 BPS this week, off from 73 BPS a week earlier.
The five-year, Treasury-indexed, hybrid, adjustable-rate mortgage jumped to 3.08 percent in Freddie’s survey from last week’s 3.01 percent.
With a 4-basis-point decline over the last seven days, the one-year Treasury-indexed ARM landed at 2.90 percent in Freddie’s survey. The one year was 3.30 percent during this week last year.
But the underlying index for the one-year ARM, the yield on the one-year Treasury note, climbed to 0.14 percent Thursday from 0.12 percent a week prior based on Treasury Department data.
Another ARM index, the six-month LIBOR, moved a basis point higher to 0.61 percent, according to Bankrate.com.
ARM share of loan inquiries in the Mortgage Market Index report slipped to 5.79 percent from 5.89 percent a week ago.
