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Freddie Mac: Average 30-year fixed mortgage unchanged at 4.57%

September 12, 2013|By E. Scott Reckard
  • Chris Thibodeau, a biotech executive, waits in line to buy into a new Huntington Beach subdivision.
Chris Thibodeau, a biotech executive, waits in line to buy into a new Huntington… (Mark Boster / Los Angeles…)

Fixed mortgage rates have leveled off more than a percentage point above recent lows, with Freddie Mac reporting that lenders this week were offering the 30-year home loan at an average of 4.57%, the same as last week.

The average offering rate for a 15-year fixed loan also was unchanged at 3.59%, according to Freddie Mac, which asks lenders about the terms they are offering to solid borrowers with down payments of 20% or more.  Start rates on popular types of variable home loans were slightly lower.

The markets are awaiting a key Federal Reserve meeting next week, when the central bank could decide to begin scaling back its economic stimulus program. The Fed has been buying $85 billion in Treasury and mortgage securities every month, and anticipation that it would begin tapering off the purchases this month has been a major factor in the rising rates.

QUIZ: How well do you understand the Fed stimulus?

The higher rates have choked off the mortgage origination business, resulting in layoffs at many home lenders. The Mortgage Bankers Assn. said Wednesday that seasonally adjusted applications for home loans dropped 13.5% last week, with refinance applications down 20% and purchase applications 3%.

The mortgage trade group said Thursday that applications for loans to buy new homes declined by 14% in August compared with July. Those figures did not include seasonal adjustments.

In another report Thursday morning, analysts at BMO Capital Markets cut their earnings estimates for four big regional banks and for No. 1 mortgage lender Wells Fargo & Co., saying revenue from home lending is falling faster than expected.

Freddie Mac asks lenders about the terms they would provide to borrowers who pay them less than 1% in upfront fees and discount points to obtain the loans. Borrowers typically are also required to pay for third-party services such as appraisals and title insurance, costs not included in the Freddie Mac survey.

US 30 Year Mortgage Rate Chart

US 30 Year Mortgage Rate data by YCharts

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