Mortgage Giant, Freddie Mac released this weeks Prime Mortgage Market Survey (PMMS) showing the average mortgage rates on a fixed rate mortgage dropping this week.
The surveys reveals the following:
30-year fixed-rate mortgage (FRM) averaged 3.92 percent with an average 0.5 point for the week ending July 27, 2017 showing adecrease from last week when it averaged 3.96 percent.
15-year FRM this week averaged 3.20 percent with an average 0.5 point, showing a decline from last week when it averaged 3.23 percent.
5/1-year ARM averaged 3.18 percent this week with an average 0.5 point, down from last week when it averaged 3.21 percent. A year ago at this time the rates averaged 2.78 percent.
Despite recent talk of the FED changing the benchmark rate, they were unable to "roll back the balance sheet" in time for Freddie Mac's survey. However it is predicted that the FED will begin unwinding its balance sheetin the upcoming future and there will be another rate increase before the end of the year.
According to Michael Fratantoni, Mortgage Bankers Association chief economist, The job market is tight, Fratantoni said. Many employers are finding it increasingly challenging to fill open positions. And yet wage growth and price inflation remain low. We agree with the Feds expectation that inflation will increase later this year and into next, and this will prompt further increases in the Feds short-term target, with the next hike most likely coming in December.
To calculate average mortgage rates, Freddie Mac surveys lenders across the country at the beginning of each week. The average doesn't include extra fees, known as points, which most borrowers must pay to get the lowest rates. One point equals 1 percent of the loan amount.