Rates on 30-year mortgages rise, crossing 5 percent threshold for first time in 3 weeks
Rates for 30-year home loans rose above the 5 percent threshold for the first time in three weeks, but remained near historically low levels.
The average rate on a 30-year fixed rate mortgage was 5.05 percent this week, up from 4.93 percent a week earlier, mortgage finance company Freddie Mac said Thursday.
Rates had dropped to a record low of 4.71 percent in December, pushed down by an aggressive government campaign to reduce consumers’ borrowing costs.
Freddie Mac collects mortgage rates on Monday through Wednesday of each week from lenders around the country. Rates often fluctuate significantly, even within a given day, often in line with long-term Treasury bonds.
Mortgage rates have been at or near record lows due to a $1.25 trillion Federal Reserve program to buy up mortgage securities. That program is scheduled to run out at the end of March, but the Fed has held the door open to extending it if the economy weakens.
Some analysts fear that once the central bank stops, mortgage rates could spike due to a lack of willing buyers, hurting the recovery in housing and the overall economy. But government officials have been optimistic about that the Fed will be able to end its program without a major disruption.
This week, the average rate on a 15-year fixed-rate mortgages rose to 4.4 percent, up from 4.33 percent last week, according to Freddie Mac.
Rates on five-year, adjustable-rate mortgages averaged 4.16 percent, up from 4.12 percent a week earlier. Rates on one-year, adjustable-rate mortgages fell to 4.15 percent from 4.23 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 0.7 point for 30-year and 15-year loans and 0.6 point for five-year and one-year loans.