Update on the average mortgage rates reported by the Mortgage Bankers Association and Freddie Mac for the week ending 7-5-2013…
Well I managed to survive the 4th of July without blowing myself up while setting off fireworks. The biggest fireworks for real estate happened today when the latest unemployment numbers came out from the Bureau of Labor Statistics. They reported a net growth of approximately 194,600 non-farm payroll jobs over the month, although the unemployment rate remained unchanged at 7.6%.
We have to wonder if this indication of a stronger economy will lead to more increases in mortgage rates? Hard to say but let’s look at the mortgage rates that Freddie Mac and the Mortgage Bankers Association reported this week:
Freddie Mac Reported:
- 30-year fixed-rate mortgages averaged 4.29%
- This is down from last week when it averaged 4.46%
- Last year at this time, 30-year fixed-rate mortgages averaged 3.62%
- 15-year fixed-rate mortgages this week averaged 3.39%
- This is down from last week when it averaged 3.50%
- Last year at this time, 15-year fixed-rate mortgage averaged 2.89%
Frank Nothaft, Freddie Mac vice president and chief economist said:
Fixed mortgage rates fell over the holiday week as market concerns over the timing of the Federal Reserve’s pullback in bond purchases eased somewhat. Rates are still low by historical standards
Check out the chart from Freddie Mac:
Now this is BEFORE those unemployment numbers I mentioned. It will be interesting to see what mortgage rates do once this long holiday weekend is over. Moving on…
The Mortgage Bankers Association Reported:
The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($417,500 or less) increased to 4.58% from 4.46%, with points increasing to 0.43 from 0.35 (including the origination fee) for 80% loan-to-value ratio loans.
The average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances (greater than $417,500) increased to 4.68% from 4.52%, with points increasing to 0.38 from 0.28 (including the origination fee) for 80% loan-to-value ratio loans.
The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA increased to 4.27% from 4.20 %, with points increasing to 0.44 from 0.40 (including the origination fee) for 80% loan-to-value ratio loans.
The average contract interest rate for 15-year fixed-rate mortgages increased to 3.64% from 3.55%, with points increasing to 0.44 from 0.43 (including the origination fee) for 80 percent LTV loans.
The Take Away:
Both Freddie and the MBA are reporting the average mortgage rates AND more importantly, these are the rates before the latest unemployment numbers were released. I hate to say it but what little relief there was from increasing mortgage rates may be short lived.
The Federal Reserve mentioning that they might start cutting back on QE caused rates to skyrocket. Just as that was beginning to settle down, we may see rates start to climb again in response to the news about unemployment. Of course, rates are still super low which means that buying a home can still be very affordable.
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.