Freddie Mac reported mortgage rates held fairly steady in the week ending Oct. 27. The 30-year fixed mortgage rate averaged 4.10% with an average 0.8 point, down one basis point from last week, while 15-year fixed rates were unchanged at 4.38%.

Adjustable-rates were mixed with one-year ARM rates declining four basis points to 2.90%, while 5/1 hybrid ARM rates jumped seven basis points to 3.08%.

Current rate levels will keep refinancing response for credit-eligible borrowers muted unless 30-year fixed rates drop towards 3.80%. This is evident in the Mortgage Bankers Association's Refnancei Index that rose 4.4% to an unimpressive 3546 in the week ending Oct. 21 with mortgage rates at an attractive 4.11%. The index remains well off its YTD high of 4867 hit in mid-August when mortgage rates tumbled from the 4.50% to 4.60% area held through the first half of summer to the 4.30%s in August.

Currently, borrowers underlying the 4.0% coupon are out of the refi window, noted Scott Buchta, managing director at Sandler O'Neill in an emailed comment yesterday, as are many lower weighted average coupon 4.5% borrowers.

He added that borrowers underlying 15-year 3.5s are on the cusp, while those underlying 4.0s continue to have an attractive incentive of around 75-80 basis points.

Subscribe Now

Access to a full range of industry content, analysis and expert commentary.

30-Day Free Trial

No credit card required. Access coverage of the securitization marketplace, including breaking news updated throughout the day.