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Mortgage rates began to retreat from their 2024 highs last week, and homebuyers took notice, with purchase-to-purchase mortgage applications falling after five straight weeks of declines, the Mortgage Bankers Association’s (MBA) weekly survey of lenders showed. Increase.
The MBA survey showed that after seasonally adjusting, home loan applications increased 11% from the previous week, but were still down 8% from the same period last year. Likewise, refinancing applications increased 8% week over week but were down 2% year over year.
Mike Fratantoni, chief economist at MBA, said in a 2017 report: “The latest inflation data were not significantly better than expected, nor significantly worse than expected, which was enough to bring down mortgage rates slightly, and the 30-year fixed mortgage Lending rates fell slightly last week to 7.02%. ” A statement.
Mike Fratantoni
Applications for Federal Housing Administration (FHA) purchase loans rose 13.5% on a seasonally adjusted basis, Fratantoni said, “again demonstrating how sensitive the first-time homebuyer community is to relatively small changes in the direction of interest rates.” “Housing data from other sources shows an increase in new listings, which is a real positive for the spring buying season given the lack of inventory for sale.”
lender Mortgage News Daily Survey It showed that 30-year fixed-rate mortgage rates have fallen five of the past six business days, falling below 7% on Wednesday to their lowest level in three weeks.
The downward trend began with the February 29 update of the Federal Reserve’s preferred inflation measure, the personal consumption expenditures (PCE) price index, which showed that inflation continued to slow in January, in line with economists’ expectations. The next day, the Institute for Supply Management’s manufacturing PMI showed that manufacturing shrank for the 16th consecutive month in February.
Produced in 10-Year Treasury BondThe mortgage rate barometer fell for a third straight day on Wednesday. Latest employment data Data from the U.S. Bureau of Labor Statistics showed job openings fell slightly from December to January, in line with economists’ expectations.
Mortgage rates drop from peak
Tracked Loan Lock Data best blue Borrowers were shown locking in 30-year fixed-rate mortgage rates at 6.82% on Tuesday, down 11 basis points from the 2024 peak of 6.93% recorded on February 28.
Optimal Blue data shows that interest rates hit a 2024 low of 6.50% on February 1, down 1.33 percentage points from the 2023 peak of 7.83% on October 25.
Mortgage News Daily reports higher rates than Optimal Blue because its index is Adjust to account for points Many borrowers pay fees to get a lower interest rate. Optimal Blue uses the actual interest rate offered to borrowers to lock in interest rates, Regardless of the points paid.
For the week ending March 1, MBA reported average interest rates for the following types of loans
- 30-year fixed rate Qualified Mortgage (loan balances of $766,550 or less), the average interest rate was 7.02%, down from 7.04% the previous week. Points for an 80% loan-to-value (LTV) loan remained unchanged at 0.67 (including the origination fee), and the effective interest rate also dropped to 7.22%.
- 30-year fixed rate interest rate jumbo mortgage (loan balances over $766,550) averaged 7.21%, up from 7.20% the previous week. Points for an 80% LTV loan dropped from 0.57 (including origination fee) to 0.36, and the effective interest rate dropped to 7.31%.
- 30-year fixed rate Federal Housing Administration Mortgage, the average interest rate was 6.86%, the same as the previous week. But as the points for an 80% LTV loan dropped from 0.99 (including the origination fee) to 0.90, the effective interest rate dropped to 7.12%.
- The price is 15-year fixed-rate mortgage The average was 6.66%, down from 6.70% the previous week. Points for an 80% LTV loan dropped from 0.68 (including origination fee) to 0.67, and the effective interest rate also dropped to 6.83%.
- for 5/1 Adjustable Rate Mortgage (ARM), the average interest rate was 6.38%, up from 6.33% the previous week. Points for an 80% LTV loan increase from 0.58 (including origination fee) to 0.67, and the effective interest rate increases to 6.62%.
The MBA survey found that ARM loans accounted for 7.7% of all mortgage applications last week, and refinance requests accounted for 30.2% of loan requests.
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