Rates on the most popular types of mortgages barely moved, according to HSH.com's Weekly Mortgage Rates Radar. The average rate for conforming 30-year fixed-rate mortgages rose by one basis point (0.01 percent) to 3.74 percent, a new 2013 high. Conforming 5/1 Hybrid ARM rates decreased by four basis points, closing the Wednesday-to-Tuesday wraparound weekly survey at average 2.68 percent.
"Fixed mortgage rates had just a little leftover momentum from last week's more substantial rise," said Keith Gumbinger, vice president of HSH.com. "However, markets became spooked this week over a bank-bailout plan in Cyprus that would have heavily taxed regular bank depositors to help defray the cost of European Central Bank (ECB) financial support to keep them afloat. As has been the case in times of fiscal trouble, money poured into U.S. Treasuries, driving the yields that influence mortgage rates lower over the past few days."
Worries about market reaction to the plan caused Cyprus banks to close until Thursday. The plan has now been rejected and the Cypriot government will need to find a new plan to be able to obtain needed assistance from the ECB, likely meaning some tense times ahead.
"Our own Federal Reserve may note ongoing troubles in world financial markets as it concludes a meeting today," said Gumbinger. "These bank insolvency issues are a problem for central bankers and ordinary citizens alike, but they do help lower rates for American mortgage borrowers, so at least there is some good that comes from them. Mortgage rates should be moving downward a little as we close the week."
Average mortgage rates and points for conforming residential mortgages for the week ending March 19, according to HSH.com:
Conforming 30-year fixed-rate mortgage
► Average rate: 3.74 percent
► Average points: 0.31
Conforming 5/1-year adjustable-rate mortgage
► Average rate: 2.68 percent
► Average points: 0.21
Average mortgage rates and points for conforming residential mortgages for the previous week ending March 12 were, according to HSH.com:
Conforming 30-year fixed-rate mortgage
► Average Rate: 3.73 percent
► Average Points: 0.27
Conforming 5/1-year adjustable-rate mortgage
► Average Rate: 2.72 percent
► Average Points: 0.19
