January 2nd, 2013

Mortgage rates begin the year by falling



falling ratesMortgage shoppers have to be pretty happy about the way 2012 ended and how 2013 has begun.

Rates on the most popular types of mortgages declined slightly, according to’s Weekly Mortgage Rates Radar. The average rate for conforming 30-year fixed-rate mortgages fell by three basis points (0.03 percent) to 3.49 percent. Conforming 5/1 Hybrid ARM rates decreased by five basis points, closing the Wednesday-to-Tuesday wraparound weekly survey at an average of 2.68 percent.

“An unsettled outlook with regard to the fiscal cliff was the focus for the stock and bond markets as we closed 2012,” said Keith Gumbinger, vice president of “Word of an agreement of sorts came when the calendar turned, but it looks as though there is much drama yet to come as cuts to spending were largely kicked down the road for a couple of months. In short order, there will also be another fight over the debt limit ceiling, but hopefully not as acrimonious as the one last summer.”

Was a ‘cliff’ deal bad for mortgage rates?

Gumbinger adds “A deal in place provides some certainty for tax policy, at least for the moment. Also, while certainty is good for the economy, it’s perhaps not as good for interest rates, which have firmed a little since the agreement was announced. Optimism may prove to be short-lived, with the drag from higher taxes expected to trim economic growth somewhat in the coming months.”

What’s in store for 2013?

Will the refinance boom finally end in 2013? Will home sales and home prices continue to increase? What about underwriting standards, will they finally loosen?

For answers (or at least some insight) to these questions and more, be sure to read our “2013 Outlook: 10 Thoughts for ’13.’

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About the HSH Blog's daily blog focuses on the latest developments in the mortgage and housing markets. Our mission is to relate how changes in mortgage rates and housing policy, as well as the latest financial news, impacts consumers, homebuyers and industry insiders alike. Our 30-plus years of experience in the mortgage industry gives us an edge as we break down the latest changes in an ever-changing market.

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Tim Manni

Tim Manni is the Managing Editor of and the author of their daily blog, which concentrates on the latest developments in the mortgage and housing markets.

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