Mortgage rates pause
Mortgage rates were flat last week, seemingly pausing in anticipation of two upcoming events — Friday’s employment report and the Federal Reserve meeting later this month.
According to the latest data released Thursday by Freddie Mac, the 30-year fixed-rate average slipped to a new low for the year, falling to 3.94 percent with an average 0.5 point. (Points are fees paid to a lender equal to 1 percent of the loan amount.) It was 3.95 percent a week ago and 3.66 percent a year ago. The 30-year fixed rate has moved lower for three weeks in a row.
The 15-year fixed-rate average was unchanged at 3.19 percent with an average 0.5 point.
It was 2.92 percent a year ago. The five-year adjustable rate average climbed to 3.11 percent with an average 0.5 point. It was 3.07 percent a week ago and 2.88 percent a year ago.
Mortgage rates may not stay low for long. A strong jobs report could send rates higher. The Federal Reserve also is widely expected to raise its benchmark rate following its June 14 meeting.
The Chicago Mercantile Exchange’s FedWatch tool indicates that investors put the chance of a rate hike at near certainty.
The prospect of higher rates should drive bond yields higher.
Because home loan rates tend to follow the path of long-term bonds, mortgage rates would likely rise too.
Yet more than half the experts surveyed by Bankrate.com, which puts out a weekly mortgage rate trend index, say rates will fall in the coming week.