Mortgage rates moved higher this week after spending a month within a hair or two of 4.5%, the latest surveys showed.
The 30-year fixed-rate loan was at 4.6% in the closely watched Freddie Mac tally, up from 4.51% a week earlier and back to where it was at the end of May, before the latest dip down. The rates tend to track the yield on the 10-year Treasury bond, which has moved higher since hitting a recent low June 24.
Freddie Mac, which asks lenders each week about the terms they are offering to well-qualified borrowers, said the 15-year fixed-rate mortgage was being offered at an average rate of 3.75% this week. Last week the rate averaged 3.69%.
The borrowers in the survey would have had solid credit, 20% down payments or home equity and would have paid 0.7% of the loan amount upfront on average in fees and discount points to the lenders.
The Freddie Mac news release said rates for adjustable loans are on the rise as well. But the big government-controlled mortgage finance company sought to emphasize that home finance is still a terrific deal by historical standards.
“Interest rates on all mortgages outstanding in the first quarter of this year averaged just under 6%,” said Freddie Mac’s chief economist, Frank Nothaft. “With today’s rates, these homeowners who have the ability to refinance could shave $169 per month in interest payments on a $200,000, 30-year fixed mortgage.”
However, the trend of rising rates seemed likely to further cut into already dwindling refinances, since most homeowners willing and able to replace their loans already have done so with rates below 5% for much of the last two years.
A Mortgage Bankers Assn. report on home-loan applications, released Wednesday, showed a 9.2% decrease in new refinancing last week from the previous week. Refi volume has now declined for three consecutive weeks.
– E. Scott Reckard
Photo: Freddie Mac headquarters in McLean, Va. The most recent Freddie Mac reports puts the rate on a 30-year-fixed mortgage loan at 4.6%. Credit: Freddie Mac