Mortgage Rates Soar to Highest Mark Since Last April

Mortgage interest rates rocketed higher this week. Reports from ""Freddie Mac"":http://www.freddiemac.com and ""Bankrate"":http://www.bankrate.com recorded significant jumps across all types of home loan products. Both companies' analysis showed that the average rate on a 30-year fixed mortgage has hit its highest level since April 2010.

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Data ""released by the Mortgage Bankers Association"":http://dsnews.comarticles/spike-in-mortgage-rates-dampen-consumer-demand-2011-02-09 (MBA) earlier this week pointed to an unmistakable falloff in consumer demand, aligned with the rate hike. Some industry experts, however, argue that rising interest rates could be a positive for the housing market.

While the ascension will probably slow the flow of refinancing activity, some are holding onto the likelihood that consumers who've been considering buying a home and those who've been on the fence waiting for some market stability to emerge will be nudged into acting now in order to take advantage of the lower borrowing costs.

""Freddie Mac’s study"":http://www.freddiemac.com/pmms/release.html?week=6&year=2011 puts the 30-year fixed-rate mortgage at 5.05 percent (0.7 point) for the week ending February 10. That’s up from 4.81 percent reported by the GSE last week. A year ago at this time, the 30-year fixed rate was averaging 4.97 percent.

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The 15-year fixed-rate mortgage this week averaged 4.29 percent (0.7 point) in the GSE’s survey. Last week it was 4.08 percent, and 12 months ago it was averaging 4.34 percent.

Short-term rates also rose this week. Freddie Mac says the 5-year adjustable-rate mortgage (ARM) jumped from 3.69 percent to 3.92 percent (0.6 point). The 1-year ARM increased from 3.26 percent to 3.35 percent (0.6 point).

The GSE’s survey is based on data gathered from about 125 lenders across the country. Bankrate’s study derives its results from data provided by the top 10 banks and thrifts in the top 10 U.S. markets. Rates among these largest lenders came in even higher.

Based on ""Bankrate’s analysis"":http://www.bankrate.com/finance/mortgages/mortgage-rates-reach-10-month-high.aspx?ic_id=tsThumb1, the benchmark conforming 30-year fixed mortgage rate spiked to 5.23 percent (0.45 points) this week. Last week, the tracking company reported it at 5.02 percent.

The average 15-year fixed mortgage climbed from 4.29 percent to 4.48 percent (0.36 point) in Bankrate’s survey, while the larger jumbo 30-year fixed rate soared from 5.54 percent to 5.74 percent.

Adjustable rate mortgages were also on the rise, with the average 5-year ARM zooming to 4.01 percent and the 7-year ARM moving to 4.38 percent.

“Mortgage rates have staged a big rebound off the record lows seen in November,” Bankrate said in its report.

“At the time, the average 30-year fixed rate was 4.42 percent, meaning a $200,000 loan would have carried a monthly payment of $1,003.89,” the tracking company explained. “With the average rate now 5.23 percent, the monthly payment for the same size loan would be $1,101.93, a difference of $98 per month for anyone sitting on the fence.”