Last week’s poor jobs report drove mortgage rates down this week, according to data released Thursday by Freddie Mac.
The 30-year fixed-rate average tumbled to 3.76 percent with an average 0.6 point, sinking to its lowest level in six months. (Points are fees paid to a lender equal to 1 percent of the loan amount.) It was 3.85 percent a week ago and 4.19 percent a year ago. Since July, the 30-year fixed-rate average has fallen 28 basis points. (A basis point is 0.01 percentage point.)
The 15-year fixed-rate average dropped to 2.99 percent with an average 0.6 point, moving below 3 percent for the first time since April. It was 3.07 percent a week ago and 3.36 percent a year ago.
Hybrid adjustable-rate mortgages were mixed. The five-year ARM average slid to 2.88 percent with an average 0.4 point. It was 2.91 percent a week ago and 3.06 percent a year ago.
The one-year ARM average rose to 2.55 percent with an average 0.2 point. It was 2.53 percent a week ago.
“Calling the September jobs report disappointing is an understatement,” Sean Becketti, Freddie Mac chief economist, said in a statement.
“The sputtering U.S. economy added only 142,000 jobs. To make matters worse, there were downward revisions to the prior two months. Hourly wages were flat, and the labor force participation rate fell to 62.4 percent, the lowest rate since 1977. In response, Treasury yields dipped below 2 percent triggering a nine basis point tumble in the 30-year mortgage rate.”
Meanwhile, as rates moved lower, mortgage applications spiked this week, according to data from the Mortgage Bankers Association.
The market composite index — a measure of total loan application volume — surged 25.5 percent from the previous week. The refinance index grew 24 percent, while the purchase index jumped 27 percent.
The refinance share of mortgage activity accounted for 57.4 percent of all applications.
“The number of applications for purchase and refinance mortgages soared last week due both to renewed rate volatility and as many applications were filed prior to the TILA-RESPA regulatory change,” Lynn Fisher, MBA’s vice president of research and economics, said in a statement.