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Mortgage rates rise to 4.23%, near record low
Two-thirds of the industry experts (63%) polled by Bankrate.com this week predict
an increase in rates over the short term. Another 31% expect no change while only
5% think rates could fall again.
The average rate for 30-year fixed loans inched up from 4.21 percent the previous
week, mortgage buyer Freddie Mac said Thursday. Earlier in the month, rates fell to
4.19 percent, the lowest average on records dating back to 1971.
The average rate on 15-year fixed loans rose to 3.66 percent. That was up from 3.64
percent a week earlier.
Rates have been falling since April. They have remained low this month because
investors have been buying up Treasury bonds in anticipation of the Federal
Reserve’s likely move to buy Treasurys to stimulate the economy. That demand
lowers Treasury yields, which mortgage rates tend to track.
Low rates haven’t helped the struggling housing market, which recorded its worst
summer in more than a decade. But they have led to a modest surge in refinancing.
To calculate average mortgage rates, Freddie Mac collects rates from lenders around
the country on Monday through Wednesday of each week. Rates often fluctuate
significantly, even within a given day.
Rates on five-year adjustable-rate mortgages averaged 3.41 percent, down from 3.45
percent a week earlier. Rates on one-year adjustable-rate mortgages remained at an
average of 3.3 percent.
The rates do not include add-on fees known as points. One point is equal to 1
percent of the total loan amount.
The nationwide fee for loans in Freddie Mac’s survey averaged 0.8 a point for 30-
year loans. It averaged 0.7 of a point for 15-year and 1-year mortgages and 0.6 of a
point for 5-year mortgages.