Mortgage rate changes
Last week mortgage market took back most of the rate decreases that were so welcome the week before. The Mortgage Bankers Association, however, recorded rate drops stretching into a second week. The Weekly Mortgage Market Survey of average contract interest rates indicated that the 30-year fixed-rate mortgages increased from 6.74% during the week of July 13 to 6.80% for the week of July 20. This was one basis point higher than the rate the week of July 6. Fees and points were down 0.1 to 0.5.
The 15-year fixed rate mortgage was up four basis points to 6.41% with fees and points unchanged at 0.4. This was still an improvement over the July 6 rates of 6.44 and 0.5 points.
The 5/1-year hybrid adjustable rate mortgage increased only slightly from 6.33% with 0.5 points to 6.36% with 0.6 points, again less than the 6.39 with 0.6 points reported two weeks ago.
The traditional 1-year adjustable rate mortgage moved up 5 basis points to 5.80; fees and points increased from 0.6 to 0.7. Again the July 6 rates were higher at 5.83% with 0.8 points.
It was also indicated that rate increases reflected a market that was still spooked by the specter of increasing inflation. The MBA’s Weekly Mortgage Applications Survey for the week ended July 21 and revealed different results. The average contract rate for 30-year fixed-rate mortgages dropped four basis points to 6.69% and points decreased from 1.13 to 1.07, including the origination fee. 15-year fixed-rate mortgages decreased from 6.38% to 6.31% and points were also down to 1.02 from 1.07. The one-year ARM was also lower by 3 basis points to 6.25% with points decreasing to 0.83 from 0.85. Mortgage activity continues to trend down - the application volume decreased by 1.3%. Compared to the same week in 2005, however, the pace was off 28.2 percent.
Refinancing as a share of all mortgage activity was up to 35.6% compared to 35.0 the previous week and adjustable rate mortgages represented 28.6% of total applications compared to 29.0% the week before.
30 Yr fix: 6.72% 0.08%
15 Yr fix: 6.34% 0.07%
1 Yr ARM: 5.78% 0.02%
30 Yr Tres: 5.11% 0.00%
Fed Prime: 8.25% 0.25%