Rates on the most popular types of mortgages mostly held fast this week, according to HSH.com's Weekly Mortgage Rates Radar. The average rate for conforming 30-year fixed-rate mortgages remained unchanged at an average interest rate of 3.71 percent. Conforming 5/1 Hybrid ARM rates decreased by one basis point (0.01 percent), closing the Wednesday-to-Tuesday wraparound weekly survey at an average of 2.97 percent.
No change to short-term interest rates
"The interest rate increase as we approached last week's Federal Reserve meeting is starting to unwind," said Keith Gumbinger, vice president of HSH.com. "The central bank made no change to short-term interest rates and gave no sign that it is in hurry to raise rates anytime soon. With this, markets started to relax again and rates are poised to slip."
Possible rate increase in June
It was no surprise that new clues to future policy were not revealed during the closing statement of the two-day Fed meeting. However, the Fed did remove a statement of the March meeting regarding global risks to U.S. growth. Domestic and foreign financial markets have calmed appreciably in recent weeks. If the quiet should persist and U.S. growth accelerates, there is still a reasonable chance that a rate increase may come in June.
"Incoming data will be what moves mortgage rates for the next while," adds Gumbinger. "As we get closer to the next Fed meeting in June, we'll likely see the pattern repeat itself, with interest rates rising somewhat as we approach that date. The change in rates will depend on the strength of the data. If the data does increase the likelihood of a Fed move, the chance of a considerable rise in mortgage rates remains small.”
Current mortgage rates
Average mortgage rates and points for conforming residential mortgages for the week ending May 03, according to HSH.com:
Conforming 30-year fixed-rate mortgage
- Average rate: 3.71 percent
- Average points: 0.19
Conforming 5/1-year adjustable-rate mortgage
- Average rate:2.97 percent
- Average points: 0.12
Average mortgage rates and points for conforming residential mortgages for the previous week ending April 26 were, according to HSH.com:
Conforming 30-year fixed-rate mortgage
- Average Rate:3.71 percent
- Average Points:0.15
Conforming 5/1-year adjustable-rate mortgage
- Average Rate: 2.98 percent
- Average Points: 0.10
Methodology
The Weekly Mortgage Rates Radar reports the average rates and points offered on conforming 30-year fixed-rate mortgages and conforming 5/1 ARMs. The weekly mortgage rate survey covers a large sample of mortgage lenders and is conducted over a Wednesday-to-Tuesday cycle, with data released every Wednesday. HSH.com’s survey helps consumers find the best rates on home loans in changing market conditions. Unlike mortgage rate surveys that report average rates only, the Weekly Mortgage Rates Radar’s inclusion of both average rates and average points provides a more accurate view of mortgage terms currently offered by lenders.
