Mortgage rates near 2015 lows
Posted on Thursday, February 11, 2016 at 11:27:24 AM
For the sixth consecutive week, mortgage rates have continued to fall. According to Freddie Mac's most recent Primary Mortgage Market Survey, the 30-year fixed-rate mortgage is now averaging 3.65 percent, or close to its 2015 low of 3.59 percent. At this time a year ago, the 30-year FRM stood at 3.69 percent.
"In a falling rate environment, mortgage rates often adjust more slowly than capital market rates, and the early-2016 flight-to-quality has run true to form," said Sean Becketti, Freddie Mac chief economist.
"The 30-year mortgage rate has dropped 36 basis points since the start of the year, while the yield on the 10-year Treasury has dropped 59 basis points over the same period," Becketti continued. "If Treasury yields were to hold at current levels, mortgage rates might well sink a little further before stabilizing."
Before that projected stabilization arrives, borrowers are taking advantage of low residential financing rates. The Mortgage Bankers Association reported that mortgage applications jumped 9.3 percent from one week earlier on the Market Composite Index, a measure of loan application volume.
The refinance share of mortgage activity increased from 59.2 percent last week to 61.2 percent of total applications in the week ending Feb. 5. Meanwhile, the share of FHA loans in total application volume decreased slightly to 12.3 percent from 12.9 percent the week prior.