HSH.com Weekly Mortgage Rates Radar: Fed Changes Language, Rates Rise
04 November 2015 - 10:05PM
Rates on the most popular types of mortgages moved higher this
week, 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 3.90 percent. Conforming 5/1
Hybrid ARM rates increased by seven basis points, closing the
Wednesday-to-Tuesday wraparound weekly survey at an average of 3.02
percent.
"The Fed closed its policy-setting meeting last week with a
subtle change to the language they've been using to describe the
future path for interest rates," said Keith Gumbinger, vice
president of HSH.com. "The small change in wording was enough to
concern markets, as it may put a December rate move back on the
table."
In recent weeks, financial markets have increasingly supposed
that the Fed might not make any rate change in 2015, but the new
wording suggests otherwise. Where the Fed had previously
characterized the future timing of a rate move with the context of
"In determining how long to maintain this [federal funds] target
range", the wording was changed to "In determining whether it will
be appropriate to raise the target range at its next meeting"; this
put a much stronger time qualifier on how soon a move might come.
Since the Fed has signaled for some time that it feels any Federal
Open Market Committee (FOMC) meeting may conclude with a change to
rates, HSH does not feel that this signals that an imminent change
will necessarily come, but rather that the "next meeting" wording
will become a long-term fixture until monetary policy approaches
something closer to historically normal. This may not happen for
some time.
"That the Fed might make a move at any meeting or at any other
time it sees fit shouldn't shock the market," adds Gumbinger.
"Economic conditions, job growth and inflation trends will dictate
if the Fed makes a move. Currently, overall growth and inflation
are fairly soft, so at the moment there's no strong expectation
that the Fed will make move soon. That said, data released in the
coming weeks will be key in this regard."
For more analysis on mortgage rates, economic conditions and the
Fed, see HSH.com's weekly MarketTrends newsletter. For a
longer-range outlook for mortgage rates, see HSH.com's new
Two-Month Forecast.
Average mortgage rates and points for conforming residential
mortgages for the week ending November 03, according to
HSH.com:
Conforming 30-year fixed-rate mortgage
- Average Rate: 3.90 percent
- Average Points: 0.16
Conforming 5/1-year adjustable-rate mortgage
- Average Rate: 3.02 percent
- Average Points: 0.10
Average mortgage rates and points for conforming residential
mortgages for the previous week ending October 27 were, according
to HSH.com: Conforming 30-year fixed-rate mortgage
- Average Rate: 3.85 percent
- Average Points: 0.15
Conforming 5/1-year adjustable-rate mortgage
- Average Rate: 2.95 percent
- Average Points: 0.09
Methodology
The Weekly Mortgage Rates Radar reports the average rates and
points offered on conforming 30-year fixed-rate mortgages and
conforming 5/1 ARMs. The weekly mortgage rate survey covers a large
sample of mortgage lenders and is conducted over a
Wednesday-to-Tuesday cycle, with data released every Wednesday.
HSH.com's survey helps consumers find the best rates on home loans
in changing market conditions. Unlike mortgage rate surveys that
report average rates only, the Weekly Mortgage Rates Radar's
inclusion of both average rates and average points provides a more
accurate view of mortgage terms currently offered by lenders.
Every week, HSH.com conducts a survey of mortgage rate data for
a wide range of consumer mortgage products including ARMs,
FHA-backed and jumbo mortgages, as well as home equity loans and
lines of credit from hundreds of direct lenders in the U.S. For
information on additional loan products, visit HSH.com.
About HSH.com
HSH.com is a trusted source of mortgage data, trends, news and
analysis. Since 1979, HSH's market research and commentary has
helped homeowners, buyers and sellers make smart financial choices
and save money on mortgage and home equity products. HSH.com, of
Riverdale, N.J., is owned and operated by QuinStreet, Inc. (NASDAQ:
QNST), one of the largest Internet marketing and media companies in
the world. QuinStreet is committed to providing consumers and
businesses with the information they need to research, find and
select the products, services and brands that best meet their
needs. The company is a leader in ethical marketing practices. For
more information, please visit QuinStreet.com.
CONTACT: Alex H. Bryant
pr@hsh.com
212-863-4753
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