Mortgage rates climbed for the sixth straight week, according to surveys conducted by Freddie Mac and Bankrate.com.
In Freddie Mac’s survey, the 30-year fixed-rate mortgage inched up to an average 6.59 percent, with an average 0.6 point, for the week ended today, up very slightly from last week’s average of 6.58 percent. The 30-year fixed-rate loan has not been higher since the week ending June 20, 2002, when it averaged 6.63 percent.
The average for the 15-year fixed-rate mortgage this week is 6.22 percent, with an average 0.6 point, also up very slightly from last week’s average of 6.21 percent. The 15-year fixed-rate loan has not been higher since the week ending May 24, 2002, when it averaged 6.28 percent.
The five-year Treasury-indexed hybrid adjustable-rate mortgage averaged 6.21 percent this week, with an average 0.7 point, unchanged from last week. The one-year Treasury-indexed ARM averaged 5.67 percent, with an average 0.8 point, down very slightly from last week when it averaged 5.68 percent.
“Mortgage rates have drifted upward for the sixth week running, which is consistent with Freddie Mac’s economic forecast,” said Frank Nothaft, Freddie Mac vice president and chief economist. “We expect that the mortgages rates will continue to trend upward over the coming year, but that upward trend will be modest at best.
“Meanwhile, with gradually rising rates, refinance activity can be expected to shift. Fewer families will be refinancing, but of those who are, a larger percentage will be drawing some equity out of their homes, many to pay off previously existing home equity loans and lines of credit as those loans become more expensive.”
In Bankrate.com’s survey, fixed mortgage rates jogged higher in the past week, with the average 30-year fixed-rate mortgage rising from 6.64 percent to 6.67 percent. This is the highest since the week of June 12, 2002. The 30-year fixed-rate mortgages in this week’s survey had an average of 0.36 discount and origination points.
Bankrate.com reported that the average 15-year fixed-rate mortgage popular for refinancing stepped up to 6.29 percent. On larger loans, the average jumbo 30-year fixed rate was unchanged at 6.83 percent. Adjustable-rate mortgages inched higher as well. The average 5/1 adjustable-rate mortgage ticked up to 6.32 percent, and the average one-year ARM nosed higher to 5.89 percent.
Mortgage rates bobbed up and down in the past week, initially declining following Fed Chairman Ben Bernanke’s report before the Congressional Joint Economic Committee, according to Bankrate.com. Bernanke’s mention of a potential pause in interest-rate hikes buoyed spirits that the Fed might not raise rates as much as expected. But that likelihood was reconsidered once Bernanke remarked that he had misinterpreted, and was merely mentioning the possibility of a pause. Rates then moved back up, with the 10-year Treasury yield rising to 5.15 percent as Bernanke reiterated that further Fed action will be data dependent. Mortgage rates are closely related to yields on long-term government bonds.
The following is a sampling of Bankrate.com’s average 30-year-mortgage interest rates this week in some U.S. metropolitan areas:
New York – 6.63 percent with 0.23 point
Los Angeles – 6.73 percent with 0.48 point
Chicago – 6.78 percent with 0.04 point
San Francisco – 6.74 percent with 0.31 point
Philadelphia – 6.61 percent with 0.44 point
Detroit – 6.71 percent with 0.01 point
Boston – 6.63 percent with 0.28 point
Houston – 6.66 percent with 0.56 point
Dallas – 6.68 percent with 0.49 point
Washington, D.C. – 6.54 percent with 0.8 point
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