U.S. mortgage rates improved moderately on Thursday, following three days of steady gains, as bonds strengthened during trading session. Pricing on treasury bonds increased today, as buyers showed more activity following a recent sell-off in the prior session. The yield on the benchmark 10-year treasury note eased to 2.2458% compared to Wednesday’s 2.283% figure. It looks like mortgage interest rates have caught a break finally, but it’s uncertain at this point if it’s just a temporary break or it reflects a longer-term stability. While most borrowers may not perceive much of today’s improvements, the closings costs that are associated with rates may decrease for some individuals. Currently, interest rates are higher by 30 basis points or more compared to figures from earlier this year. And the Fed hasn’t even hiked short-term interest rates yet.
Mortgage-buyer, Freddie Mac published its weekly national mortgage survey on Thursday, which revealed that the benchmark 30-year fixed mortgage averaged a rate of 3.85% this week, an uptick of 5 basis points compared to the prior week’s data. The 15-year fixed mortgage also averaged a higher interest rate this week, in the form of 3.07%. A week earlier this type of loan averaged a rate of 3.02%.
When the economy is improving, it tends to drive mortgage rates higher. However, in the last few days we have got some rather weak economic data, like March’s JOLTS report and April’s retail sales data. Now, we should take note, that Freddie Mac collects responses from lenders early in the week, which means the current survey figures don’t take those economic data into account that gets released later during the week.
Another financial company, Bankrate released its own weekly survey earlier today, and as per the recent findings, the 30-yixed mortgage continued moving higher this week. Currently, the 30-year FRM stands at 4.01%, and uptick of 2 basis points compared to last week’s data. The 15-year fixed mortgage loan came in at 3.22%, a higher rate than last week’s 3.17%. Overall, this marks the fourth consecutive week that mortgage rates have been on an upward path. According to Bankrate, the yield on 10-year Treasury notes soared earlier this week amid a global bond-sell off, which put a pressure on mortgage rates. And even mortgage lending requirements have loosened lately, many potential borrowers have remained on the fence.
Moving on to today’s economic data, less Americans filed claims for unemployment last weeks, the Labor Department reported on Thursday. For the week ending May 9, initial claims for unemployment benefits dropped by 1,000 to a seasonally adjusted 264,000. Analysts polled by Reuters had forecast a reading of 276,000. Another piece of economic data from the Labor Department showed, that the producer price index, which measures the prices of services and goods before they reach consumers, dipped 0.4% in April, after an increase in March (0.2%). Core prices, which exclude volatile food and energy categories, slipped 0.2%. As expected, these reports haven’t really pushed mortgage rates to any direction. As we have experienced this week, currently the market seem to be moving independent of economic data, whether it’s exceptionally good or worse-than-expected.
We have already talked about the Fed’s impending rate hike quite a lot this week. As we mentioned in yesterday’s mortgage report, the weaker-than-expected April’s retail sales data may take the possibility of a June rate hike off the table. It seems that former Fed Vice Chairman Donald Kohn thinks the same. In a note to Potomac Research clients, Donald Kohn said that the debate of a rate hike timing is now between September and December.
With regards to current mortgage interest rates at major lenders, we haven’t noticed many changes this Thursday. Bank of America (NYSE:BAC) is offering the 30-year fixed home purchase loan for as low as 3.875%. The 15-year version of the bank’s conventional home loan is coming out at 3.000%. Switching to home refinancing options, BofA’s 30-year FRM is up for grabs at an interest cost of 4.000%. Borrowers, who prefer the shorter, 15-year fixed home refinance loan, will see this type of loan carrying a rate of 3.000% as of Thursday.
The updated home loan information by Wells Fargo (NYSE:WFC), shows that the 30-year standard mortgage loan can be obtained at a rate of 4.125%. In case of the 15-year fixed mortgage loan, borrowers may able to secure it for as low as 3.375%. Under Wells Fargo’s refinance loan portfolio, the benchmark 30-year mortgage loan for home refinancing is published at 4.250%. Those leaning toward the 15-year FRM, will see these type of loan plans starting at 3.375%.
At U.S. Bank (NYSE:USB), the 30-year conventional home purchase loans remained steady at 4.125% today. The same can be said about the 15-year fixed home mortgage, which is quoted at 3.375%.
The above mentioned interest rates are subject to change and are not guaranteed. In order to search for live mortgage rate quotes from some of the top U.S. lenders, please click on the link below. To calculate your monthly mortgage payment, feel free to use our featured mortgage calculator.