RISMEDIA, July 13, 2007—Mortgage rates increased slightly, with the average 30-year fixed mortgage rate now 6.78%. According to Bankrate.com’s weekly national survey of large lenders, the average 30-year fixed mortgage has an average of 0.29 discount and origination points.
The average 15-year fixed rate mortgage popular for refinancing moved higher to 6.46%. On larger loans, the average jumbo 30-year fixed rate moved back over the 7% threshold to 7.02%. Adjustable rate mortgages behaved the same, with the average one-year ARM and 5/1 ARM each rising, to 6.27% and 6.54%, respectively.
Since hitting a one-year high last month, mortgage rates have stabilized. In the weeks since, mortgage rates have remained in a very narrow band — just one-tenth of one percentage point. This is reminiscent of what was seen earlier this year when mortgage rates hovered for a three-month span within a range of just one-sixth of one percentage point.
Although mortgage rates have been calm in recent weeks, how long will this prevail? We might get an answer to that in the next week, with several inflation barometers on the economic calendar, as well as Ben Bernanke’s congressional testimony and the release of the FOMC’s June meeting minutes. Any of those could be the catalyst for renewed volatility in Treasury yields and mortgage rates. Fixed mortgage rates are closely related to yields on long-term government bonds.
Fixed mortgage rates are nearly one-half percentage point higher than three months ago. At the time, the average 30-year fixed mortgage rate was 6.31%, meaning that a $165,000 loan would have carried a monthly payment of $1,022.38. With the average 30-year fixed rate now 6.78%, the same loan originated today would carry a monthly payment of $1,073.48.
Fixed mortgage rates still remain the better refinancing alternative for adjustable rate borrowers facing sharp payment adjustments.
30-year fixed: 6.78% — up from 6.74% last week (avg. points: 0.29)
15-year fixed: 6.46% — up from 6.41% last week (avg. points: 0.26)
5/1 ARM: 6.54% — up from 6.48% last week (avg. points: 0.25)
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.