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Residential financing rates hold steady near yearly lows

Posted on Friday, August 1, 2014 at 10:09:02 AM

Lower residential financing rates allow more people to jump into the housing market, helping out this segment and the U.S. economy as a whole. Thankfully for those interested, rates are holding near yearly lows.

This is based on information released in Freddie Mac's recent Primary Mortgage Market Survey. The 30-year fixed-rate mortgage averaged 4.12 percent for the week ending July 31. That is barely below the previous seven-day period of 4.13 percent. The 15-year FRM also ticked down during that time span, now at 3.23 percent compared to 3.26 percent. Both of these rates are lower than year-ago levels.

"Mortgage rates were little changed this week with the 30-year fixed-rate mortgage rate at 4.12 percent, just a basis point lower from the previous week," explained Frank Nothaft, vice president and chief economist at Freddie Mac. "Meanwhile, on Wednesday afternoon the yield on the 10-year Treasury surged as data showed gross domestic product for the second quarter at a 4.0 percent annualized rate, above expectations."

In addition, the Mortgage Bankers Association reported that interest in residential financing is relatively steady as well. For the week ending July 25, purchase applications ticked down only 2.2 percent on a weekly basis. The Refinance Index declined 4 percent during that period, while the refinance share of total mortgage activity dropped from 54 percent to 53 percent.