Mortgage interest rates across the board spiked this week, following long-term bond yields higher as the focus among investors shifted to the budget deficit and the possibility of inflation. According to ""Freddie Mac"":http://www.freddiemac.com, the commitment rate for a 30-year fixed rate mortgage is now at its highest level since December 11, 2008, 25 weeks ago.
Freddie Mac released the results of its ""Primary Mortgage Market Survey"":http://www.freddiemac.com/pmms/release.html (PMMS) on Thursday. For the week ending June 4, 2009, 30-year fixed-rate mortgages (FRMs) averaged 5.29 percent (0.7 point), a significant jump from last week when they averaged 4.91 percent. Last year at this time, though, the 30-year FRM averaged 6.09 percent.
The 15-year FRM in Freddie Mac's study averaged 4.79 percent (0.7 point) this week. Last week it came in at 4.53 percent, and a year ago it was 5.65 percent.
Freddie Mac reported that interest rates for 5-year Treasury-indexed hybrid adjustable-rate mortgages (ARMs) averaged 4.85 percent this week (0.6 point), up slightly from last week when they were 4.82 percent. A year ago, the 5-year ARM averaged 5.51 percent.
Based on Freddie Mac's market survey, 1-year Treasury-indexed ARMs averaged 4.81 percent this week (0.6 point). Last week they were 4.69 percent, and at this time last year, the 1-year ARM averaged 5.06 percent.
Despite the increase in numbers this week, ""Bankrate"":http://www.bankrate.com, which issues a similar weekly mortgage rate report, notes that commitment rates for home loans still remain well below the six percent mark, and are not an impediment to well-qualified borrowers. Bankrate also says the Federal Reserve, with more than $1 trillion remaining in their mortgage- and government-bond buyback program, could accelerate those purchases to bring rates back down.
According to ""Bankrate's weekly mortgage survey"":http://www.bankrate.com/mortgagerates, based on data provided by the top 10 banks and thrifts in the nation's top 10 markets, the average rate for 30-year FRMs rose to 5.65 percent this week. The average 15-year FRM among the largest institutions climbed to 5.06 percent, while the average jumbo 30-year fixed rate rebounded to 6.68 percent. Bankrate reported the 5-year ARM jumped to 5.20 percent, while the 1-year ARM averaged 5.01 percent this week.