There are many different ways to track mortgage rates and several different sources quoted in the news. For decades, the most prevalently-quoted source has been Freddie Mac’s weekly primary mortgage market survey. It consists of a questionnaire sent out to loan officers at the beginning of every week. They can respond as late as Wednesday, but the responses are heavily front-loaded (most respondents simply fire right back when they see the email). As such, Freddie’s weekly rate survey, which is reported every Thursday , is best thought of as measuring the change in top tier mortgage rates from one Monday to the next, perhaps with some Tuesday influence sprinkled in. That’s fine on weeks where there isn’t much volatility, but it can end up sending very mixed messages otherwise. Much of 2022 has been “otherwise” and today is not only no exception, it’s probably the starkest example. Freddie’s survey showed an increase from 3.55 last week to 3.69 this week. This assumes a best case scenario 30yr fixed with 0.8 points paid upfront. I don’t love the idea of building points into rate indices if points can change over time. I’d rather just adjust the rates to reflect the points since there’s reliable math for that purpose. For example, at most lenders right now, you’d pay 1 point to drop the rate by 0.25%. If Freddie made that adjustment, their 3.69 would rise to 3.89 . But remember, that would have applied to Monday/Tuesday based on Freddie’s methodology. Lo and behold , the rates I calculate every day were at 3.87% and 3.89% on Mon/Tue respectively.
Source: Mortgage News Daily
