Freddie Mac: 30-year mortgage rate falls to 7.11%, but the 10-year yield has jumped since

The average 30-year fixed mortgage rate fell to 7.11% in Freddie Mac's weekly survey released Thursday, Nov. 12, down from 7.18% a week earlier and 7.40% on Oct. 15. That is four straight weekly declines and the lowest reading since the 7.03% of Sept. 24. The 15-year rate fell to 6.45% from 6.57%.

The headline is true, and it is also a look in the rear view mirror. Mortgage pricing follows the 10-year Treasury yield, and that yield moved the wrong way after the survey week.

The number behind the number: yields rose 31 basis points

According to the Treasury's daily rates, the 10-year closed at 4.84% on Nov. 5, 4.88% on Nov. 9 and 4.98% on Nov. 10. It then closed at 5.10% on Nov. 12 and 5.15% on Nov. 13. For comparison, the 10-year was 5.10% on Oct. 15, the day Freddie Mac's rate stood at 7.40%.

That does not mean next Thursday's number will be 7.40%. Lenders also price in their own margins, and the survey is built from the loan applications Freddie Mac sees during the week. But it does mean the four-week slide was driven by a yield that has now given back most of its fall, and a buyer should not assume the trend continues. Nothing in the data tells us where it goes next.

What 7.11% does to a payment

On a $400,000 loan, principal and interest only (our calculation, 30-year fixed):

Since mid-October the decline has cut the payment by $78.69 a month. Against a year ago, a buyer still pays $230.56 more a month, about $2,767 a year. Taxes and insurance are not included.

Who this actually hits

A buyer closing in December who has not locked. If your quote was built on the 4.9% yield of early November, ask your lender what today's pricing is before you assume the 7.11% headline applies. Floating through a 31 basis point move in the benchmark is the risk, and the choice to lock or float is yours and your lender's, not ours.

A seller pricing a listing. Buyers shop on the monthly payment. A one-week move of a few hundredths in the survey changes little, but a rise in the 10-year back above 5% pushes the other way.

A self-employed buyer. If your income comes from the business, lenders will usually want tax returns and bank statements, which takes time. A longer process means more exposure to rate moves between application and lock, so start the paperwork early. Our real estate coverage tracks this weekly.

What to watch next

Freddie Mac publishes its next survey on Thursday, Nov. 19. The 10-year Treasury yield, which you can follow on our 10-year chart, is the best early read on whether the streak of declines survives.

Sources: Freddie Mac Primary Mortgage Market Survey; U.S. Department of the Treasury daily par yield curve rates; payment figures are Chronicle calculations. This is market information, not investment advice.