Weekly Rates Followed Bond Yields to Higher Levels

Most mortgage interestrnrates rose during the week ended February 25 according to data released onrnThursday by Freddie Mac from its Primary Mortgage Market Survey.

The 30-year fixed-raternmortgage (FRM) averaged 5.05 percent during the week, up from 4.93 the previousrnweek.  Fees and points were unchanged atrn0.7 point.  The 15-year FRM was up 7rnbasis points to 4.40 percent and fees and points increased from 0.6 to 0.7rnpoint.

Adjustable rate mortgagesrn(ARMs) were mixed with the five-year Treasury-indexed hybrid ARM up from 4.12rnpercent with 0.5 point to 4.16 percent with 0.6 point.  The one-year Treasury-indexed hybrid ARM,rnhowever, declined from 4.23 percent to 4.15 percent.  Average fees and points for 1-year ARMS remainedrnat 0.6 point.  

Frank Nothaft, Freddie Macrnvice president and chief economist said, in a statement accompanying the raternrelease, “Interest rates for 30-year fixed mortgages followed long-term bondrnyields higher and rose above 5 percent this week amid a mixed set of economicrndata reports.  For instance, the Januaryrnproducer price index jumped well above the market consensus, but the consumerrnprice index remained subdued and consumer confidence declined to the lowestrnlevel since April 2009, according to the Conference Board.

“There were also varyingrnreports as to the current state of the housing market. The S&P/Case-Shiller®rnnational home price index rose for the third consecutive quarter in the fourthrnquarter, albeit at a slower rate, and the 20-city composite index showed anrnincrease in December 2009 for the seventh month in a row; six metropolitanrnareas experienced positive year-over-year growth, compared to four in November.rnNew home sales, however, unexpectedly slowed in January to the smallest pacernsince records began in 1963, and the supply of homes at the current sales raternrose to 9.1 months, the most since May 2009.”

Fannie Mae's report onrnaverage weekly yields for the week ended February 19 showed the same pattern asrnthat reported by Freddie Mac; long term rates were up while ARMs drifted lower.

Fannie Mae's yield onrnconventional 30-year FRMs averaged 4.82 percent for  the week compared to 4.71 a week earlierrnwhile the 15-year FRM increased from 4.04 percent to 4.11 percent.  FHA and VA guaranteed 30-year mortgagesrnincreased 10 basis points to 5.49 percent. rnThe one-year ARM averaged 2.46 percent compared to 2.47 percent a weekrnearlier. 

All Fannie Mae yields arernquoted on a net basis with no servicing fees included.

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