The average rate on a 30-year U.S. mortgage fell again this week, echoing a decline in long-term U.S. Treasury bond yields ahead of the Federal Reserve\u2019s first rate cut this year.<\/p>\n
The rate eased to 6.26% from 6.35% last week, mortgage buyer Freddie Mac said Thursday. A year ago, the rate averaged 6.09%.<\/p>\n
Borrowing costs on 15-year fixed-rate mortgages, popular with homeowners refinancing their home loans, also fell. The average rate slipped to 5.41% from 5.5% last week. A year ago, it was 5.15%, Freddie Mac said.<\/p>\n
Mortgage rates are influenced by several factors<\/a>, from the Federal Reserve\u2019s interest rate policy decisions to bond market investors\u2019 expectations for the economy and inflation.<\/p>\n Rates generally follow the trajectory of the 10-year Treasury yield, which lenders use as a guide to pricing home loans. The yield was at 4.12% in midday trading Thursday, up from 4.06% late Wednesday.<\/p>\n Mortgage rates have been mostly declining since late July amid expectations that Fed would cut rates for the first time since last year. As expected, the central bank delivered a quarter-point cut Wednesday<\/a> and projected it would lower its benchmark rate twice more this year, reflecting growing concern over the U.S. job market.<\/p>\n The average rate on a 30-year mortgage is now at its lowest level since Oct. 3, when it was 6.12%.<\/p>\n The late-summer slide in mortgage rates has been a welcome trend for the housing market, which has been in a slump since 2022, when mortgage rates began climbing from historic lows. Sales of previously occupied U.S. homes sank last year<\/a> to their lowest level in nearly 30 years and have remained sluggish so far this year<\/a> as the average rate on a 30-year mortgage has mostly hovered above 6.5%.<\/p>\n \u201cMortgage rates have eased into the low 6% range, a shift that should support a modest pickup in home sales in the coming months,\u201d said Jiayi Xu, senior economist with Realtor.com. \u201cHowever, the broader impact will remain limited, as 81% of homeowners still hold mortgages below 6%, reducing incentives to sell or move.\u201d<\/p>\n Still, the pullback in mortgage rates has led to a surge in homeowners who bought in recent years after rates climbed above 6% to refinance now to a lower rate.<\/p>\n Mortgage applications, which include loans to buy a home or refinance an existing mortgage, jumped nearly 30% last week from the previous week, according to the Mortgage Bankers Association.<\/p>\n Applications for mortgage refinancing loans made up nearly 60% of all applications last week.<\/p>\n Demand for adjustable-rate mortgages, or ARMs, is also up sharply. Applications for ARMs accounted for about 13% of all loan applications. That\u2019s the biggest share since 2008, in the aftermath of the 2000s housing bust.<\/p>\n The Fed’s rate cut makes ARMs more attractive, as the rates on those loans closely follow the central bank’s action on short-term interest rates, said Bill Banfield, chief business officer at mortgage lender Rocket Cos.<\/p>\n \u201cFor consumers, it\u2019s another signal that the cost of borrowing is gradually moving lower,\u201d Banfield said.<\/p>\n","protected":false},"excerpt":{"rendered":"The average rate on a 30-year U.S. mortgage fell again this week, echoing a decline in long-term U.S.…\n","protected":false},"author":2,"featured_media":166150,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[36],"tags":[100188,28,101,4665,5412,100187,41499],"class_list":["post-166149","post","type-post","status-publish","format-standard","has-post-thumbnail","category-economy","tag-benchmark-rate","tag-business","tag-economy","tag-freddie-mac","tag-mortgage-rates","tag-mortgage-refinancing","tag-u-s-treasury"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/posts\/166149","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/comments?post=166149"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/posts\/166149\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/media\/166150"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/media?parent=166149"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/categories?post=166149"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/tags?post=166149"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}