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Residential financing rates reverse course on weekly basis

Posted on Thursday, December 11, 2014 at 10:16:02 AM

Over the past several weeks, government-sponsored enterprise Freddie Mac has reported a downward trend for residential financing rates. While still quite low, this week's analysis showed a new direction.

The 30-year fixed-rate mortgage averaged 3.93 percent for the seven-day period ending Dec. 11, according to Freddie Mac. Last week, that average was 3.89 percent. The 15-year FRM increased from 3.10 percent to 3.20 percent during that time. However, both remain well below year-ago averages of 4.42 percent for the 30-year FRM and 3.43 percent for the 15-year FRM.

"Fixed mortgage rates rebounded this week with the 30-year fixed mortgage rate increasing to 3.93 percent after declining for four weeks in a row," explained Frank Nothaft, vice president and chief economist for Freddie Mac. "The rate rise comes on the heels of an uplifting jobs report showing nonfarm payrolls adding 321,000 new jobs in November - 91,000 more jobs than expected. The unemployment rate remained unchanged at 5.8 percent."

In addition, the Mortgage Bankers Association reported that residential financing applications have increased on a weekly basis, up 7.3 percent for the week ending Dec. 5. Refinance applications accounted for 64 percent of total activity, while adjustable-rate mortgages made up 7 percent.