On Thursday, the Freddie Mac reported that the average interest rate on 30-year fixed loan mortgages saw a significant increase from a week ago. The most recent increase to 4.12 percent surmounted the all-time record low 3.94 percent,  the first time ever that rates fell below 4 percent, or so according to the National Bureau of Economic Research.

Average Mortgage Rates, Margins, Fees and Points

The data was a result of the Primary Mortgage Market Survey, or PMMS, which is conducted each week and regionally observes and breaks down average mortgage rates, margin, and fees and points. Of course, the big news is that 30-year fixed mortgage (FRM) rates showed stellar increase as well as an average .08 point for the week while other fixed rates, such as the 15-year rate, increased to a record average 3.37 percent. Coupled with the monstrous jump the 30-year fixed loan made, the 15-year rates have actually been a popular practice of refinancing for investors and the outlook for that continuation appears good for those already involved. Yet, regardless of the increase, mortgage rates are still in the range of their 60-year lows, when both the 30-year and 15-year FRMs were averaging higher this time a year ago.

Unemployment Stays Unchanged

Last week, the Bureau of Labor Statistics released a report summarizing the current U.S. employment situation. It stated that in September, nonfarm payroll employment bulged by 103,000 while the number of unemployed persons, around 14 million, stayed mostly unchanged, reflecting a hold in the unemployment rate. After the Freddie Mac’s latest report on fixed rates, Frank Nothaft, chief economist and vice president for Freddie Mac, was quick to acknowledge and appreciate the impact this had on the mortgage rates and 5-year treasury-indexed adjustable rate mortgages, which also saw a rise in average to 3.06 percent. But, reasonably, he didn’t take it for granted.

“An employment report that was better than market expectations helped to lift long-term Treasury bond yields and mortgage rates as well. The economy added 103,000 workers in September, aided by the return of striking Verizon workers,” he said. “However, these job gains are still not large enough to bring down the current unemployment rate of 9.1 percent.”

Frank Nothaft’s vision is all too realistic, and his concern of the unemployment rate still reflects the concerns of investors in the housing market, or those potential investors, to say the least. The truth is that they all still have their backs to the wall in regard a shaken economy where nightmares of being fired or laid off do enough mentally to hold off capable buyers from taking any risk in purchasing or refinancing homes.

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