Borrowers caught a bit of a break during the weeks ended June 7 and 8. Freddie Mac, in its Weekly Primary Mortgage Survey reported that average mortgage rates for all four categories of loans it tracks decreased up to six basis points from the previous week.

Rates for the 30-year fixed rate mortgage declined from 6.67 percent to 6.62 percent although fees and points increased from 0.4 to 0.5. The 15-year fixed was down three basis points to 6.23 percent; fees and points mirrored that of the 30-year. A year ago the 30-year averaged 5.56 percent and the 15-year averaged 5.14 percent.

Adjustable rate mortgages (ARMs) also dropped back. The 5/1-year mortgage averaged 6.20 percent compared to 6.26 the week before and fees and points were unchanged at 05. The 1-year ARM was down five basis points to 5.63 although fees and points climbed back up to 0.8 from 0.7.

Frank Nothaft, Freddie Mac's vice president and chief economist credited low job growth last month with lowering the upward pressure on long-term rates. Preliminary estimates of job growth in March and April were also recently revised downward. Nothaft said "The slight drop in long term rates reflects a cautiously optimistic outlook in the market that core inflation remains contained."

Differences among the various regions continue to range widely; there was a deviation of up to 27 basis points in most categories. The North Central was again the priciest for fixed rate mortgages and the hybrid 5/1 with the 30-year at 6.73, the 15-year at 6.31, and the hybrid averaging 6.38 percent. The Southeast had the lowest average rates at 6.60, 6.23 and 6.11 respectively. These differences, however, were partially neutralized by fees and points, however with customers in the North Central region paying 0.3 and those in the Southwest 0.7 to 0.8 depending on the product.

Traditional one-year ARMs were most expensive in the Southeast with an average of 5.70 percent and lowest in the Northeast at 5.50. Customers in the Southeast were also paying the highest average fees and points - the first time we have seen a full point in a long time.

The Mortgage Bankers Association in their Weekly Application Survey for the week ended June 8 reported that rates moved up although fees dropped across the board.

The 30-year fixed-rate mortgage was up a single basis point to 6.61 percent with points, including the origination fee, decreasing from 1.19 to 1.13. The 15-year fixed-rate mortgage averaged 6.27 percent compared to 6.23 percent a week earlier and points decreased from 1.16 to 1.13. This was the highest rate for a 15-year mortgage in the MBA survey since April 2002.

One-year ARMS increased four basis points to 6.09 percent with points dropping to 0.82 from 0.86. All figures are for conventional 80 percent loan to value loans.

Applications were up 7 percent on a seasonally adjusted basis from the week ended June 2 and 17.9 percent on an unadjusted basis but sharply off from one year ago, a 34.3 percent decrease.

Refinances represented 35.7 percent of all mortgage applications, a 1.5 percent increase, and the share of adjustable rate mortgages was also up from 29.4 to 30.7 percent.