HSH.com Weekly Mortgage Rates Radar: Despite Small Rise, Mortgage Rates Poised to Ease

Foster City, Calif. (PRWEB) July 03, 2013

Rates on the most popular types of mortgages increased slightly, according to HSH.com’s Weekly Mortgage Rates Radar. The average rate for conforming 30-year fixed-rate mortgages rose by five basis points (0.05 percent) to 4.45 percent. Conforming 5/1 Hybrid ARM rates increased by seven basis points, closing the Wednesday-to-Tuesday wraparound weekly survey at an average of 3.30 percent.

“The big jump in mortgage rates late last week has settled somewhat,” said Keith Gumbinger, vice president of HSH.com. “From the data we gather each day, indications are that rates have started to slide backward a little bit, relative to what we observed last week.”

Mortgage rates rose to nearly two-year highs last week, leaping on concerns that the Fed would begin to unwind its program of purchasing Mortgage-Backed Securities (MBS) and Treasury bonds sooner than markets anticipated. In response to this, some Federal Reserve governors and regional bank presidents have made statements that the markets are misinterpreting the Fed’s intentions. This has calmed markets, allowing mortgage rate increases to flatten out, bringing the potential for declines before the week is out.

“We’ve always known that the Fed will end QE3 at some point,” adds Gumbinger. “What we don’t know, and even the Fed may not yet know, is when that process will begin and how quickly it will come to a conclusion. This will depend upon how well the economy performs, especially job growth and inflation. Whether mortgage rates can ease or will continue to move higher depends on these factors, starting with the June employment report due out Friday.”

Average mortgage rates and points for conforming residential mortgages for the week ending July 2, according to HSH.com:

Conforming 30-year fixed-rate mortgage

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