Mortgage Rates Take a Breather

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After increasing sharply for several weeks, the pace of rising rates slowed to a crawl
RISMEDIA, April 29-Mortgage rates increased for the sixth consecutive week, but barely. The average 30-year fixed rate mortgage inched higher, from 6.06 percent to 6.07 percent, according to Bankrate.com’s weekly national survey of large lenders.

The mortgages in this week’s survey had an average of 0.41 discount and origination points. In the past six weeks, the average 30-year fixed rate mortgage has increased from 5.41 percent to 6.07 percent.

The 15-year fixed rate mortgage popular for refinancing climbed from 5.37 percent to 5.4 percent. The jumbo 30-year fixed rate mortgage climbed 2 basis points to 6.25 percent, while the one-year adjustable rate mortgage dipped 1 basis point to 3.85 percent. A basis point is one one-hundredth of one percentage point.

After increasing sharply for several weeks, the pace of rising rates slowed to a crawl this week. Bond investors largely shrugged off economic reports showing rising consumer confidence and continued strength in the sale of new- and used-homes. Financial markets are in a wait-and-see mode ahead of the May 4 meeting of the Federal Reserve’s rate-setting committee and the May 7 monthly employment report.

The Fed’s economic assessment and the April employment report might reinforce each other, causing rates to fall sharply or rise steeply, or they could work at cross purposes and have only a minor effect on rates.

Faced with the uncertainty, the mortgage market stayed in standby mode this week.

Mortgage rates have jumped 66 basis points in the past six weeks, and monthly mortgage payments have climbed, too. With the average 30-year fixed rate mortgage now 6.07 percent, the monthly payment for a $165,000 30-year fixed rate mortgage is $996.70. Six weeks ago, when the average rate was 5.41 percent, the monthly payment on the same loan was $927.56. The $69.14 difference in monthly payments amounts to more than $24,800 over the loan term.

Bankrate’s national weekly mortgage survey is conducted each Wednesday from data provided by the top 10 banks and thrifts in the top 10 markets.

For more information, visit http://www.bankrate.com/mortgagerates

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