Mortgage Rates Rose in Week
July 25 2008 - Home-mortgage rates rose this week on inflation fears, with the benchmark 30-year, fixed-rate loan soaring more than a quarter percentage point to a national average of 6.63%, its highest level in nearly a year, Freddie Mac said.
“Market concerns about rising inflation, further weakness in the housing market and greater probability that the Federal Reserve will raise short-term rates this year all combined to push mortgage rates higher,” said Frank Nothaft, Freddie Mac chief economist.
The 30-year loan hit 6.68% on Aug. 7, 2007, the last time it was this high. Despite turmoil in the financial sector, mortgage rates have largely held steady as demand for housing remains weak. Existing-home sales are at a 10-year low, the National Association of Realtors said Thursday.
The 15-year fixed-rate mortgage jumped to 6.18%, up from 5.78% last week. A year ago, the 15-year loan was 6.37%.
Adjustable-rate mortgages leapt more than their fixed-rate counterparts. The five-year, Treasury-indexed hybrid loan hit 6.16%, up from 5.80%. The one-year, Treasury-indexed ARM vaulted to 5.49% from 5.10%. A year ago, the hybrid was 6.30% and the ARM at 5.69%.