Mortgage Rates Climb After Months of Record Lows

Freddie Mac announced Thursday that after more than three months of record-low drops, mortgage rates slid up this week.

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Freddie Mac's ""Primary Mortgage Market Survey"":http://www.freddiemac.com/pmms/ showed that the 30-year fixed-rate mortgage (FRM) averaged 3.55 percent (0.7 point) for the week ending August 2, up from 3.49 percent the previous week. Before this week, the average 30-year FRM had fallen to or matched record-low levels for 13 of the past 14 weeks.

The 15-year FRM also slid up, averaging 2.83 percent (0.6 point) from 2.80 percent last week.

In addition, the 5-year adjustable-rate mortgage (ARM) averaged 2.75 percent (0.6 point), a slight increase from the last survey's finding of 2.74 percent. On the other hand, the 1-year ARM fell a bit, averaging 2.70 (0.4 point) from 2.71 percent a week ago.

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""Recent announcements of additional debt relief for the Eurozone and mixed domestic economic indicators added upward pressure on Treasury yields as well as mortgage rates this week,"" said Frank Nothaft, VP and chief economist at the GSE. ""The U.S. economy grew at a 1.5 percent annualized rate in the second quarter, slower than the 2.0 percent growth in the first quarter with consumer spending in June unchanged from May. However, consumer confidence rose in July for the first time in five months, according to The Conference Board.""

Meanwhile, ""Bankrate"":http://www.bankrate.com/ reported mixed results, with the 30-year fixed averaging 3.77 percent (up from 3.75 percent the previous week). The 5-year ARM also inched up to 2.91 percent (from 2.89 percent); however, the 15-year FRM dropped from 3.00 percent to a new low of 2.99 percent.

""Comments from the President of the European Central Bank helped reverse some of the recent flight to quality that had brought bond yield and mortgage rates consistently lower. Mortgage rates are closely related to the yields on government bonds. When investors are nervous and piling into safe haven investments, it serves as a catalyst for lower rates. But the reverse is also true, and when any of those trades gets unwound, it pushes rates higher,"" said Bankrate in a release.