Mortgage rates fall to lowest level in months
As expected, mortgage rates moved lower last week thanks to the inaction by the Federal Reserve back on September 18. The decline in mortgage rates was more than expected — we thought the decline would be more of a multi-week affair, rather than as quickly as it occurred over the past seven business days — but markets move as they wish.
Mortgage rates now waiting on jobs report and debt ceiling
In the fresh economic data out last week, there was nothing to suggest that the economy is moving strongly one way or the other, although the next significant report is now on the horizon in the form of the employment report, due out this Friday.
Of course, there’s also the debt ceiling/budget showdown now playing in Congress which could have an effect on mortgage rates, too, but it’s hard to know exactly what might take place, when it will occur and how long it might last. A debt ceiling deal is likely to get done, even if today’s brinkmanship over the budget does lead to a temporary shutdown of the government.
For now, we’ll simply have to soothe ourselves with the lowest mortgage rates we’ve seen in a couple months.
Mortgage rates fall to lowest in months
- 30-year fixed-rate mortgages: The overall average rate for a 30-year fixed-rate mortgage (conforming, non-conforming and jumbo) eased by 13 basis points (0.12 percent) to 4.52 percent, the lowest value since late June.
- 15-year fixed-rate mortgages: The overall average rate for a 15-year fixed-rate mortgage (conforming, non-conforming and jumbo) managed to shed 11 basis points (0.11 percent) from the previous week’s figure, sliding to 3.63 percent.
- FHA 30-year fixed-rate mortgages: FHA-backed 30-year fixed-rate mortgages improved by 14 basis points, dropping back to an average of 4.13 percent.
- 5/1 Hybrid ARM: The 5/1 Hybrid ARM gave up another 11 hundredths of a percentage point (0.11 percent) halting its slide at 3.27 percent.
Mortgage rates should level off
If the present overall pattern for economic data holds, all will be probably lukewarm in some way or another, and mortgage rates will level off, with the most likely move being down by a couple of basis points (warmer data could reverse this, however).