Mortgage rates rose considerably this week on news of strong consumer confidence and unpredictable inflation, Freddie Mac and Bankrate.com reported today.

In Freddie Mac’s survey, the 30-year fixed-rate mortgage reached an average 6.37 percent, up from last week’s 6.21 percent, while the 15-year fixed-rate mortgage grew from 5.92 percent to 6.06 percent. Points, which are fees lenders charge for loan processing expressed as a percent of the loan, averaged 0.4 on the 30- and 15-year loans.

“Stronger-than-expected consumer confidence and recent comments from members of the Federal Reserve (Fed) raised some inflation concerns in the market, causing it to lower expectations of a Fed rate cut this year. This helped push mortgage rates higher this week,” Frank Nothaft, Freddie Mac vice president and chief economist, said in a statement.

Borrowing costs on adjustable-rate mortgages (ARMs) also climbed this week, with the five-year Treasury-indexed ARM rate average rising from 5.92 percent to 6.02 percent and the one-year ARM up from 5.48 percent to 5.64 percent. Points on these loans averaged 0.5 and 0.6, respectively.

“We expect a gradual rise in mortgage rates over the remainder of the year with sales slipping further in the second half of the year,” Nothaft said. “A gradual recovery returns toward the end of 2007 with modest increases in sales and construction during 2008.”

In Bankrate.com’s survey, mortgage rates broke out of a narrow range, rising to the highest point since January — 6.42 percent for the 30-year fixed — with discount and origination points averaging 0.26.

The average 15-year fixed-rate mortgage, popular for refinancing, increased by a similar amount, to 6.15 percent, Bankrate.com reported. With larger loans, the average jumbo 30-year fixed rate climbed to 6.64 percent. On adjustable-rate mortgages, the average one-year ARM nudged higher to 6.08 percent, while the 5/1 ARM jumped up to 6.32 percent.

Bankrate.com said that mortgage rates increased by one-tenth of a percentage point this week, but after three months of comparatively little movement, this was enough to mark a four-month high. For more than three months, the average 30-year fixed-rate mortgage fluctuated within a very narrow range, about one-sixth of one percentage point. The culprit wasn’t economic data, as the economic calendar has been quiet in the past week. Rather, a surge in corporate debt issuance and the unwinding of some positions by bond traders pushed bond yields and mortgage rates — which are closely related — upward.

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 – 6.44 percent with 0.05 point

Los Angeles – 6.48 percent with 0.38 point

Chicago – 6.47 percent with 0.11 point

San Francisco – 6.39 percent with 0.44 point

Philadelphia – 6.45 percent with 0.2 point

Detroit – 6.48 percent with 0.04 point

Boston – 6.48 percent with 0.05 point

Houston – 6.35 percent with 0.44 point

Dallas – 6.3 percent with 0.47 point

Washington, D.C. – 6.33 percent with 0.46 point

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