We research, you save.

Mortgage Rates Radar: Mortgage rates: Downward trend continues

HSH.com

Rates on the most popular types of mortgages eased for a third-consecutive week, according to HSH.com's Weekly Mortgage Rates Radar. The average rate for conforming 30-year fixed-rate mortgages fell by four basis points (0.04 percent) to 4.46 percent. Conforming 5/1 Hybrid ARM rates decreased by another lone basis point, closing the Wednesday-to-Tuesday wraparound weekly survey at an average of 3.24 percent.

Mortgage rates trending lower

"After trending lower due to the soft December employment report, some additional economic worries have helped mortgage rates to fall further," said Keith Gumbinger, vice president of HSH.com. "A preliminary January report suggests that growth in China may be slowing more than was expected, which has implications for many economies around the world that depend upon exports. This is coupled with a Federal Reserve that intends to provide less economic support going forward, which could exacerbate the slowing. Sensing this, many investors decided that it is safer to stash money in Treasuries, driving yields and mortgage rates lower."

Federal Reserve's waning influence

The Federal Reserve wraps up a two-day meeting today, as Ben Bernanke's tenure comes to a close and we welcome a new chair in Janet Yellen. It is expected that the Fed will continue to reduce purchases of Treasuries and mortgage-backed securities at a measured pace throughout 2014, but the recent softer data may provide a reason to skip making a change here and there in favor of a more cautious, data-driven approach.

Gumbinger adds, "While it is likely that the Fed will announce another reduction in QE purchases today, there is a chance they will hold off as they take time to fully evaluate the market's response to December’s program trim, which is only now being fully realized. The first $10 billion reduction didn't seem to have too much impact overall on the mortgage market as mortgage rates are already well off their lows. In the weeks since the change occurred, interest rates have actually declined, so the Fed will probably feel that there is little risk to housing or financial markets by cutting back some more."

Current mortgage rates

Average mortgage rates and points for conforming residential mortgages for the week ending January 28, according to HSH.com:

HSH.com Mortgage Rates Radar - Four Week Trend

Conforming 30-year fixed-rate mortgage

  • Average rate:   4.46 percent
  • Average points: 0.16

Conforming 5/1-year adjustable-rate mortgage

  • Average rate:   3.24 percent
  • Average points: 0.10

Average mortgage rates and points for conforming residential mortgages for the previous week ending January 21 were, according to HSH.com:

Conforming 30-year fixed-rate mortgage

  • Average Rate:   4.50 percent
  • Average Points: 0.21

Conforming 5/1-year adjustable-rate mortgage

  • Average Rate:   3.25 percent
  • Average Points: 0.11

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

More help from HSH.com