Mortgage Rates on the Rise
Mortgage rates turned upward in the week ending May 7, according to Freddie Mac's (FRE) Primary Mortgage Market Survey released today. Thirty-year fixed-rate mortgages averaged 4.84% with an average 0.7 point, up from last week's 4.78% average, but far below 6.05%, the average recorded last year at this time. After sitting stagnant at 4.80% for three consecutive weeks, the 15-year fixed-rate mortgage increased this week to 4.51%. A year ago at this time, the 15-year FRM averaged 5.60%. “Mortgage rates rose slightly this week amid positive economic news that the economy may be approaching the bottom of the recession,” said Frank Nothaft, Freddie Mac vice president and chief economist. “In addition, the positive news was corroborated by Fed Chairman Bernanke when he stated that he expects economic activity to bottom out, then to turn up later this year. He also noted that the housing market is beginning to stabilize." Five-year Treasury-indexed hybrid adjustable-rate mortgages (ARMs) also rose this week, from 4.8% last week to 4.9%. And One-year Treasury-indexed arms were no exception to the climbing trend, increasing just slightly from 4.77% last week to 4.78% this week. Signs of housing activity are beginning to emerge. Pending existing home sales rose for the second consecutive time in March and represented the first back-to-back monthly increase since March 2008. In its April 2009 Senior Loan Officer Opinion Survey, the Federal Reserve found the demand for prime mortgages rose for the first time since April 2007 when it first began collecting such detailed mortgage data. A separate rates survey conducted by Bankrate.com also found mortgage rates increased. The Benchmark, 30-year fixed-rate mortgage rose 4 basis points to 5.27%, according to Bankrate, while the benchmark 15-year fied rate mortgage rose 5 basis points to 4.78%. Write to Kelly Curran.