Interest rates on home loans eased this holiday week but could come in higher in the next report. Shorter-term rates were less attractive.
In Freddie Mac’s Primary Mortgage Market Survey for the week ended July 3, thirty-year fixed rates averaged 4.12 percent.
The average slipped 2 basis points compared to a week earlier and was down 17 BPS from a year earlier.
Thirty-year rates are likely to be around 7 BPS worse in Freddie’s next report, according to Mortgage Daily’s analysis of Treasury market activity.
A benchmark for fixed mortgage rates, the yield on the 10-year Treasury note, averaged 2.58 percent during the period Freddie surveyed lenders for this week’s report, while the 10-year yield closed at 2.65 percent Thursday, according to Department of the Treasury data.
Half of the panelists surveyed by Bankrate.com agreed with Mortgage Daily’s forecast, while 38 percent predicted rates won’t move more than 2 BPS over the next week and 12 percent expected a decline.
Jumbo mortgage rates were 11 BPS lower than conforming rates in the U.S. Mortgage Market Index report from LoanSifter/Optimal Blue and Mortgage Daily for the week ended June 27. The jumbo-conforming spread widened from 9 BPS the prior week
At 3.22 percent, 15-year fixed rates were the same as in Freddie’s survey for the week ended June 26. The difference between 15- and 30-year rates narrowed to 90 BPS from 92 BPS in the previous report.
Freddie reported that the five-year, Treasury-indexed, hybrid, adjustable-rate mortgage averaged 2.98 percent, also the same as in the prior week.
A 2-basis-point week-over-week improvement left the one-year Treasury-indexed ARMs at 2.38 in Freddie’s report. One-year ARMs averaged 2.66 percent in the week ended July 3, 2013.
The yield on the one-year Treasury note, which serves as an index for one-year ARMs, closed at 0.11 percent today, the same as last Thursday, the Treasury Department reported.
Another, less utilized, ARM index — the six-month London Interbank Offered Rate — was 0.33 percent as of Wednesday, the same as seven days earlier.
ARMs accounted for 10.8 percent of overall activity in the latest Mortgage Market Index report.
