The average rate for a 30-year fixed-rate mortgage slipped five basis points to 3.9% in Freddie Mac's closely watched primary market rate survey for the week ending March 1.
The average 15-year FRM rate dropped two basis points to 3.17%, the average rate for a five-year Treasury-indexed hybrid mortgage rose by three basis points to 2.83% and the average rate for a one-year Treasury adjustable-rate mortgage fell by a basis point to 2.72%.
During the most recent week points averaged 0.8 of a point for FRMs, 0.7 of a point for Treasury hybrids and 0.6 of a point for Treasury ARMs.
A year ago the 30-year's weekly average was 4.87%, the 15-year averaged 3.17%, the five-year Treasury hybrid averaged 2.83% and the one-year Treasury ARM averaged 2.72%.
“Rates have been range bound for a long time now. It's steady volume. We're not seeing spikes in volume,” John Walsh, president of Total Mortgage Services, told this publication. “If it stayed that way the next 12 months I'd be a very happy person.”
“Purchases are starting to pick up a little bit but obviously refinances are really driving the market still,” he added. “The Spring market might be part of it, but there is a little more purchase activity and hopefully that trend continues.”
Frank Nothaft, Freddie Mac chief economist and vice president, said in his weekly rate report that fixed mortgage rates “bottomed out” in January and February of this year and recent economic indicators suggest the housing market has been improving.
Walsh said even if the rates tick upward by a quarter or half a percent as some expect, HARP 2 might help bolster any ensuing loss in refinancing as there continue to be borrowers unable to refinance due to underwater loans or other circumstances outside the market's underwriting guidelines that might qualify under that government program's terms.
However, it is still hard to say the extent to which lenders might use the “open access” portion of this version of the Home Affordable Refinance Program that allows mortgage market participants to refi loans from other lenders that is still getting underway. Walsh said he is making sure to carefully vet it.
“Everybody's still kind of waiting. The big servicers are starting to take advantage, but it hasn't trickled down to us yet,” he said.
