Mortgage Rates Fall

Average rates for various types of mortgages fell over last week’s data, according to a report released Thursday by Freddie Mac (FRE). The government-sponsored entity reported only one rise. The rate of one-year Treasury-indexed ARMs rose to an average 5.15 percent from 5.12 percent last week. Although it was the only rate to show an increase, the one-year ARM rate also showed the largest year-over-year drop of 58 basis points. Freddie’s weekly Primary Mortgage Market Survey also reported 5-year Treasury-indexed ARMs, 30-year and 15-year fixed-rate mortgages well below the rates reported the same week last year. The largest week-over-week drop occurred in 30-year FRMs, where the average rate fell 16 basis points to 5.94 percent. The average rate for 15-year FRMs fell 15 basis points last week to 5.63 percent, down 43 basis points from last year’s rate of 6.06 percent. The lowest weekly decline occurred in 5-year ARMs, which fell only 10 basis points to 5.90 percent. “Longer-term mortgage rates fell for the first time in three weeks, roughly following bond market yields,” said Freddie Mac vice president Frank Nothaft in a media statement. “Meanwhile, the latest housing market data showed some pickup in home purchase activity in August.” Conflicting data in mortgage application trends coupled with declines in home asking prices, however, show recent volatility in the mortgage industry. “In this environment, there is not a clear direction for [mortgage] interest rates,” Keith Gumbinger, vice president of HSH Associates, told MarketWatch. Editor’s note: Kelly Curran contributed to this report. To contact the reporter on this story, email [email protected]. Disclosure: The authors held no relevant positions when this story was published. Indirect holdings may exist via mutual fund investments. HW reporters and writers follow a strict disclosure policy, the first in the mortgage trade.

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