Interest rates on the most popular types of mortgages have, over the past few weeks, reached 19- or 20-month lows several times over. In Zillow’s weekly mortgage rate report, 30-year FRMs improved yet again, dropping two basis points from 3.58 percent last week to 3.56 percent this week. 30-year FRMs had been quite volatile over the course of the Wednesday-to-Tuesday wraparound week, fluctuating between 3.53 percent and 3.77 percent for majority of the week, reaching a low of 3.46 percent as of Friday, and shooting up to the current, though still lower rate on Tuesday, February 3.
15-year FRMs remained under 3 percent, finishing the wraparound week at 2.90 percent, while 5-1 adjustable-rate mortgages ended the week at the same rate of 2.90 percent.
Zillow attributed international economic concerns to the volatility of rates over the past week, though it expects rates will not change that much ahead of Friday’s release of employment figures. “Rates edged down late last week, hitting new 20-month lows before inching up slightly on Monday,” said Zillow vice president of mortgages Erin Lantz. “International economic turmoil continues to drive markets, but we expect rates to remain fairly flat leading up to Friday’s employment report.”
The company also released its predictions for the Mortgage Bankers Association’s Weekly Application Index, forecasting that purchase loan activity would be down 5 percent from the previous week, with seasonal adjustment. Zillow bases its predictions on loan requests made on Zillow Mortgages with the prior week’s MBA Weekly Application Index data, and has been accurate on several occasions – the seasonally adjusted purchase index did decline, but by a bit less (2.3 percent) than expected. The refinance index, however, was up 2.5 percent on the MBA’s report.
Among major states covered by the Zillow Mortgages report, Pennsylvania experienced the biggest downtick in 30-year fixed mortgage rates, as the 30-year FRM slid ten basis points from 3.62 percent to 3.52 percent. Mortgage rates were also down significantly in Massachusetts, where 30-year FRMs, previously at 3.59 percent, lost seven basis points to end the week at 3.52 percent. In New Jersey and New York, 30-year FRMs were down six hundredths of a percentage point – from 3.64 percent to 3.58 percent in New Jersey and 3.72 percent to 3.66 percent in New York.
On the other side of the fence, Florida was the only major state where 30-year FRMs had added a few basis points from the previous week. Zillow’s data shows 30-year fixed mortgage rates in Florida moving up from 3.54 percent to 3.56 percent for the week ended February 3, 2015. Smaller rate declines of three or four basis points were recorded in California, Colorado, Illinois, and Texas.
Zillow’s disclaimer in its press releases describes its Zillow Mortgages real-time rates as being “based on thousands of custom mortgage quotes submitted daily to anonymous borrowers” on its website. These rates are reflective of the most updated market trends, but are not to be confused with marketing rates, or the typical weekly survey released by the likes of Freddie Mac and Bankrate.