(Best Syndication News) Mortgage interest rates were mostly higher today despite a downturn in some of the benchmarks used by lenders to adjust their loan products (see the mortgage rate charts below). U.S. Bank, JPMorgan Chase, and Citibank were among the banks raising their rates.
The Federal Reserve said there is wide-spread improvement in the real estate market. Residential real estate improved in all 12 districts. Existing homes sales strengthened while prices began to stabilize. In their October Beige Book, the central bank also moved their manufacturing and service sector outlook to “positive”.
The U.S. economy is growing at a modest pace. Ten of the 12 districts reported modest growth since their last snapshot. Only Kansas City and New York saw growth either leveling-off or slowing. Economists are uncertain whether the low 2 percent GDP growth rate can sustain an improvement in the unemployment rate.
The positive economic news released by the Fed was tempered by new European debt worries. The Standard & Poor’s Rating Agency cut Spain’s sovereign debt to BBB- (minus). The government’s credit rating is now near junk status.
The Spanish downgrade renewed fears of another global slowdown. OPEC trimmed their forecast for oil demand. The organization’s statement, along with slow global growth fears, pushed light sweet crude oil prices down.
The Dow Jones Industrial Average (DJIA) remained in negative territory before dropping 128 points by the closing bell. The S&P 500 and the NASDAQ were down 0.62 percent and 0.43 percent respectively.
Money flowed into the safe-havens. The economic worries pushed bond and note prices higher driving down yields. The 10-year note yield fell two basis points (bps) to 1.72 percent (see the benchmark chart below).
Secondary lenders were mixed. The Federal Home Loan Mortgage Corp (OTC:FMCC) lowered their 30-year 60-day required net yield (RNY) rate two bps to 2.63 percent. The Federal National Mortgage Association (OTC:FNMA) raised their rate one basis point to 2.79 percent.
The London InterBank Offered Rate (LIBOR) continued to slide. The 6-month LIBOR fell one point to 0.6079 percent and the 1-year LIBOR fell one point to 0.9445 percent.
The average 30-year fixed rate mortgage (FRM) advanced one basis point to 3.442 percent (see the mortgage rate chart below). The difference between the 10-year note yield and the average 30-year mortgage expanded three bps to 1.722 percent.
The average FHA loan rate fell to 3.918 percent and the average VA loan rate fell to 3.745 percent.
Citigroup Inc. (NYSE:C) raised their conventional rate seven bps to 3.65 percent.
JPMorgan Chase & Co. (NYSE:JPM) raised their rate two bps to 3.61 percent.
The average 15-year fixed mortgage rate fell one basis point to 2.989 percent.
Citigroup held their rate unchanged, however JPM raised their rate seven bps to 2.99 percent. Their 20-year rate was unchanged.
The average 5-year adjustable rate mortgage (ARM) climbed to 3.133 percent.
By: John Waters
|Wednesday||1 Day||5 Day||30 Day||100-Day||100-Day|
|10/10/12||Benchmark||Point Ch.||Point Ch.||Point Ch.||Point Ch.||Low|
|3.61||Bond Buyer's 20-yr bond index||0||-6||-15||-10||3.61|
|2.59||FHLMC 30 yr 30 days RNY||-2||2||-16||-66||1.59|
|2.63||FHLMC 30 yr 60 days RNY||-2||1||-17||-66||1.68|
|2.759||FNMA 30 yr 30 days RNY||1||7||-22||-48||2.635|
|2.79||FNMA 30 yr 60 days RNY||1||6||-24||-49||2.68|
|0.214||1 Month LIBOR Rate||0||0||-2||-3||0.2135|
|0.34275||3 Month LIBOR Rate||0||-1||-8||-12||0.34275|
|0.6079||6 Month LIBOR Rate||-1||-1||-10||-13||0.6079|
|0.9445||1 Year LIBOR Rate||-1||-1||-9||-12||0.9445|
|2.48||20-year Bond Yield Rate *||-4||0||10||6||2.11|
|1.72||10-year Note Yield Rate *||-2||2||6||-3||1.43|
|0.18||1-Year Note Yield Rate *||0||0||0||-3||0.16|
|0.1||3-month Note Yield Rate *||0||0||-2||1||0.07|
|1.069||11th District Cost of Funds||0||0||-5||-9||1.069|
|2.380||Difference 3-mo & 20 yr **||-4||0||12||5||2.01|
|1.722||Difference 10yr Note 30yr Loan||3||5||-28||-27||1.66785|
|* Treasury Yields - DAILY|
|** Pos change - economy to improve soon (probit model)|
Mortgage Rate Chart:
|Best Syndication News Mortgage Survey|
|Wednesday||1 Day||5 Day||30 Day||100-Day||100-Day|
|10/10/12||National Average APR*||Point Ch.||Point Ch.||Point Ch.||Point Ch.||Low|
|3.442%||Average 30 yr fixed||1||7||-22||-30||3.31%|
|3.918%||Average 30 yr FHA||0||3||-28||-50||3.81%|
|3.745%||Average 30-yr VA||0||5||-17||-20||3.61%|
|2.989%||Average 15 year FRM||-1||4||-10||-28||2.92%|
|3.133%||Average 5/1 ARM||0||1||3||-7||3.06%|
|4.048%||30 Yr Fixed Jumbo||-1||8||-16||-29||3.93%|
|3.145%||15 Yr Fixed Jumbo||0||6||-11||-17||3.04%|
|10/10/12||Citi Financial||1 Day||5 Day||30 Day||100-Day||100-Low|
|3.65%||30 Year Fixed||7||9||-14||-62||3.43%|
|3.08%||15 Year Fixed||0||4||-11||-77||2.95%|
|10/10/12||Chase||1 Day Pt||5 Day Pt||30 Day Pt||100-Day||100-Low|
|3.61%||30-Year Fixed Rate||2||14||-11||-37||3.34%|
|3.51%||20-Year Fixed Rate||0||15||-8||-24||3.24%|
|2.99%||15-Year Fixed Rate||7||7||-7||-29||2.79%|
|* Average includes more banks than listed|
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