An Insider’s Look Into How Secondary Marketing Evaluates LOs

In this webinar we’ll explore the long-term financial impacts of renegotiations, extensions and fallouts, plus basic guidelines to be viewed as a professional by your secondary marketing department

HousingWire Annual Virtual Summit

Sessions from HousingWire Annual 2021 are going to be virtually streamed on October 25. Register now for FREE to tune into what housing industry leaders had to say this year!

How Freddie Mac is addressing affordable housing challenges

Freddie Mac is focused on addressing limited access to credit, housing inequalities, creation and preservation of affordable housing supply and advancement of homeownership education.

A NAR board member tells (almost) all

For this week’s Houses in Motion, a miniseries that is part of HousingWire Daily, we spoke with Lisa Dunn about the pressing issues in real estate, including disclosure of agent commission.

Mortgage

Mortgage rates rise on job-market concerns

The average rate for a 30-year fixed mortgage is 3.01% this week, up from 2.98%

Mortgage rates rose from a record low this week, increasing above the 3% threshold, as a resurgence in COVID-19 infections in the U.S. caused lenders to worry about the jobs market.

The average rate for a 30-year fixed mortgage is 3.01%, Freddie Mac said on Thursday, up from 2.98% last week, which marked the first time the rate fell below 3%. The 15-year rate averaged 2.54%, up from last week when it was 2.48%, the lowest in a data series going back almost 30 years, according to the mortgage financier.

Mortgage rates rose as lenders reacted to news of record-setting COVID-19 infections in some of the nation’s biggest states. The resurgence of the pandemic caused jobless claims to rise this week for the first time since late March, the Labor Department said in a report on Thursday.

“The concern is that the pause in economic activity will cause unemployment to remain elevated, which will lead to longer-term labor market distress,” said Sam Khater, Freddie Mac’s chief economist.

If the rate had tracked the 10-year Treasury yield this week, as it normally does, it likely would have set a new record low. Investors are piling into the bond markets because of concerns about the impact on the economy of the worsening pandemic.

But lenders are letting that difference, known as a margin or a spread, widen as they keep a buffer called a “risk premium,” said Keith Gumbinger, vice president at HSH.com, a mortgage data firm.

The higher rate may also reflect that lenders are overwhelmed by applications to refinance mortgages and don’t want to worsen the flood of new borrowers, he said.

“In the last couple of weeks we’ve seen a flare of refinancing activity,” Gumbinger said. “Lenders are thinly staffed, so this could be a little metering of the flow of inbound business.”

In the long-term, rates likely are heading lower, he said.

“I still think rates are going to go lower as we go forward because of the slow economy, and we probably will see risk premiums easing going forward,” Gumbinger.

Leave a comment

Most Popular Articles

FHFA to make desktop appraisals permanent

Desktop appraisals, a temporary flexibility implemented in March 2020 amid lockdowns and social distancing, will become permanent, the FHFA said today.

Oct 18, 2021 By

Latest Articles

Mortgage execs better prepare for redlining enforcement

Since Rohit Chopra was confirmed as the new director of the CFPB in September, there’s been one particular word on the lips of mortgage executives. And it gives them chills: redlining. HW+ Premium Content

Oct 20, 2021 By
3d rendering of a row of luxury townhouses along a street

Log In

Forgot Password?

Don't have an account? Please