LendingTree’s most recent monthly Mortgage Offers Report, which analyzes data from actual loan terms offered to borrowers on LendingTree.com, shows that December’s best offers for borrowers with the best profiles had an average APR of 3.8% for conforming, 30-year fixed purchase loans, up from 3.75% in November.
Refinance loan offers were up 1 basis point to 3.7%, the company says.
For the average borrower, purchase APRs for conforming 30-year fixed loans offered on LendingTree’s platform were up 12 basis points to 4.42%, the highest since July 2016. The loan note rate hit the highest since March 2016, at 4.32%, and was up 14 basis points from November.
Consumers with the highest credit scores (760+) saw offered APRs of 4.26% in December versus 4.56% for consumers with scores of 680-719. The APR spread of 30 basis points between these score ranges was 3 basis points wider than in November and the widest since the data series began in April 2016.
The spread represents nearly $15,000 in additional costs for borrowers with lower credit scores over 30 years for the average purchase loan amount of $233,586, according to LendingTree.
Refinance APRs for conforming 30-year fixed loans were up 7 basis points to 4.31%. The credit score bracket spread widened to 24 basis points from 20 basis points, amounting to $12,000 in extra costs over the life of the loan for lower-credit-score borrowers, given an average refinance loan of $241,973.
Average proposed purchase down payments have been rising for eight months and reached $63,740, the company says.
“Interest rates for 2017 were, on average, lower than had been expected at the start of the year, but they did end the year on an upswing,” says Tendayi Kapfidze, LendingTree’s chief economist and report author.
“Since we began tracking this data in April 2016, the rate for the average borrower has risen by 50 basis points, from 3.92% to 4.42%. However, borrowers with 760+ credit scores saw an increase of just 40 basis points, while those from 620 to 639 had their rates increase by 80 basis points.”