News that a rate increase was on the table did not affect this week’s mortgage survey by Freddie Mac because the survey was completed before it broke. The government-backed mortgage-backer aggregates current rates weekly from 125 lenders nationwide to come up with a national mortgage rate.
But economists are predicting mortgage rates will move higher. Nearly three-quarters of the experts surveyed by Bankrate.com, which puts out a weekly mortgage rate trend index, said that home loan rates are likely to rise this week. None believe they will fall.
The 15-year fixed-rate average held steady at 2.81 percent with an average 0.5 point. It was 3.05 percent a year ago.
The five-year adjustable rate average ticked up to 2.8 percent with an average 0.5 point. It was 2.78 percent a week ago and 2.88 percent a year ago.
“The 10-year Treasury yield saw minimal movement over the past week, despite encouraging news from April’s consumer spending and CPI data,” Sean Becketti, Freddie Mac chief economist, said in a statement. “Although there was minimal change in rates this week, the hawkish tone of Wednesday’s Fed minutes release had an immediate impact on Treasury yields, and could possibly shake up next week’s survey results.”
Meanwhile, mortgage applications were down this week, according to the latest data from the Mortgage Bankers Association.
The market composite index — a measure of total loan application volume –fell 1.6 percent from the previous week. The refinance index inched up 1 percent, while the purchase index dropped 6 percent.
The refinance share of mortgage activity accounted for 54.7 percent of all applications.