A modest improvement was recorded for fixed rates on single-family loans this past week. But fixed rates are poised for a sharp ascension next week.
Conventional, conforming fixed rates on loans that are utilized to finance a home purchase
averaged 4.11 percent during October.
The rate, which was reported Tuesday by the Federal Housing Finance Agency, was down 3 basis points compared to a month earlier.
In the Primary Mortgage Market Survey from Freddie Mac for the week ended Nov. 30, thirty-year fixed rates averaged 3.90 percent.
That was a 2-basis-point decline from the previous seven-day period. Thirty-year rates were also lower than 4.08 percent one year ago.
“We closed our survey prior to a surge in long-term interest rates following an upward revision to third quarter U.S. Real GDP growth and comments by Federal Reserve Chair Yellen touting a broad-based economic expansion,” Freddie Mac Deputy Chief Economist Len Kiefer said in the report.
Joe Farr, director of sales and marketing at MBSQuoteline, said in a written statement to Mortgage Daily that growing expectations for tax reform today and yesterday have pushed mortgage yields up around 8 BPS from when Freddie’s survey was conducted.
A Mortgage Daily analysis of Treasury market activity suggests that fixed rates could be around 8 BPS worse in Freddie’s next survey.
Mortgage rates are likely to rise at least 3 BPS over the next week, according to a plurality of panelists surveyed by Bankrate.com for the week Nov. 29 to Dec. 6. But no change was predicted by 36 percent, while just 18 percent expected a decline.
Jumbo interest rates were
14 BPS higher than conforming rates in the U.S. Mortgage Market Index from Mortgage Daily and OpenClose for the week ended Nov. 24. The spread ballooned from just 3 BPS the preceding week.
At 3.30 percent, 15-year fixed rates in Freddie’s survey were 2 BPS lower than in the week ended Nov. 23. There was no change in the 60-basis-point spread between 15- and 30-year rates.
Freddie reported that five-year, Treasury-indexed, hybrid, adjustable-rate mortgages averaged 3.32 percent, 10 BPS worse than in the preceding survey.
The yield on the one-year Treasury note, which is utilized as the index for hybrid ARMs,
closed Thursday at 1.62 percent, a basis point more than a week earlier, according to Treasury Department data.
Another ARM index, the six-month London Interbank Offered Rate, was 1.66 percent as of Wednesday, according to Bankrate.com. LIBOR jumped from 1.63 percent the previous Wednesday.
The 11th District Cost of Funds Index was reported by the Federal Home Loan Bank of San Francisco at 0.737 percent for October. COFI, which serves as an index on some legacy ARMs, rose from 0.729 percent in September.
ARM share widened to 12.8 percent in the most-recent Mortgage Market Index report from 10.8 percent seven days prior.
