Freddie Mac reported that 30-year fixed mortgage rates for the week ending July 15 remained the same from last week. Current rates are at their record low of 4.57% (with an average 0.7 point).

This level keeps the no-point rate at around 4.75%, around 25 basis points above the point that would lead to a significant pickup in refi activity — primarily from 2009 5s and 4.5s.

Freddie Mac also reported that 15-year fixed and one-year ARM mortgage rates slipped one basis point to 4.06% and 3.74%, respectively, while 5/1 hybrid ARMs jumped 10 basis points to 3.85%.

Despite attractive rate levels, refinancing activity is expected to remain relatively unresponsive.

While many borrowers are unable to refinance because of the tight credit conditions, capacity constraints at mortgage bankers have also been cited as a contributing factor.

Mortgage bankers are more cautious on the process of vetting borrowers as the GSEs have become more aggressive in putting back loans for various violations.

Limited staffing levels and the new RESPA rules have also factored in and are reportedly dragging down lender productivity. 

Loan costs have also affected some borrowers who might otherwise have been eligible based on LTV and good credit.

For example, JPMorgan Securities analysts said that many of the advertised rates require some amount of origination fee. After factoring this in and comparing the decline in the monthly payment to total fees, the "breakeven" time is just not attractive, analysts said.  

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