Checking the average mortgage rates reported by the MBA, Freddie Mac and Bankrate.com plus what the latest unemployment numbers and the news from the ECB means…
Time once again to check the average mortgage rates reported by the MBA, Freddie Mac and Bankrate.com this week. Plus I am going to sum it all up with the latest unemployment numbers and the news from the ECB means for mortgage rates. So without any more blah blah blah, let’s dive right in:
Freddie Mac Reported:
- 30-year fixed rate mortgages averaged 4.14%
- This is up from last week when it averaged 4.12%
- Last year at this time, 30-year fixed rate mortgages averaged 3.91%
- 15-year fixed rate mortgages averaged 3.23%
- This is up from last week when it averaged 3.21%
- Last year at this time, 15-year fixed rate mortgages averaged 3.03%
Check out the chart showing mortgage rates from Freddie Mac:
The 30-year fixed-rate mortgage rose 7 basis points to 4.32%
The 15-year fixed-rate mortgage rose 6 basis points to 3.41%
The average rate for a 30-year jumbo mortgage rose 6 basis points to 4.35%
The Mortgage Bankers Association Reported:
The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($417,000 or less) decreased to 4.26% from 4.31%, with points decreasing to 0.13 from 0.15 (including the origination fee) for 80% loan-to-value ratio (LTV) loans.
The average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances (greater than $417,000) decreased to 4.22% from 4.23%, with points decreasing to 0.11 from 0.16 (including the origination fee) for 80% loan-to-value ratio (LTV) loans.
The average contract interest rate for 15-year fixed-rate mortgages decreased to 3.39% from 3.42%, with points increasing to 0.07 from 0.06 (including the origination fee) for 80% loan-to-value ratio (LTV) loans.
The Take Away:
These are of course the average rates and probably don’t reflect what is realistic or possible for everyone. Finding out what is possible means talking to the mortgage professional of your choice.
However, keeping an eye on the average mortgage rates does give us insight into the ever changing lending conditions. This week’s average mortgage rates also were in place BEFORE the latest unemployment numbers came out. And these mortgage rates probably also do not reflect the changes that have resulted from the European Central Bank announcing that it is cutting interest rates.
Both Freddie and Bankrate reported increasing average mortgage rates but for some reason the MBA reported decreasing rates. However, the MBA also reported that despite the super low mortgage rates, the number of applications fell again. This means fewer people getting a mortgage which should translate into fewer home sales in the coming 45 to 60 days.
Normally, a somewhat positive jobs report would put upward pressure on mortgage rates. Because the ECB has made changes that make US bonds more attractive to investors, it seems to have offset any effect on mortgage rates from the positive unemployment news.
Check out the chart showing the unemployment rate:
If you look at the labor participation rate, you see we still have a long way to go:
For now, the historically low mortgage rates do not seem to be enough to convince some people to buy a home. Considering that we still have way too many people either unemployed or under employed, it is not surprising.
Remember that mortgage rates change constantly and home prices are still rising.
How long the effect of the ECB cutting rates keep mortgage rates from rising more and/or faster is hard to say.
This could be only a temporary delay to the inevitable rise in mortgage rates that many have predicted.
As always, I am providing this to you for informational purposes only! I am not a mortgage lender and you should contact the lender of your choice directly to learn more about its mortgage products and your eligibility for such products.