Fixed Mortgage Rates Resume Rising
Freddie Mac released its weekly update on national mortgage rates Thursday morning, and it looks like rates are back on the rise.
Thirty-year fixed-rate mortgages (FRMs) gained six basis points over the past week, rising to 4.16%. Fifteen-year FRMs were likewise on the march -- up seven basis points, rising to 3.27%.
Adjustable-rate mortgage (ARMs) took a different path, with 5/1 ARMs holding steady at 2.96%, and one-year ARMs actually falling three b.p. to 2.61%, returning to the same level they occupied in mid-February.
Rates remain near historically low levels and had been dropping the past couple of weeks.
Commenting on the numbers, Freddie Mac Vice President and Chief Economist Frank Nothaft cited widespread "positive economic data" such as a fifth straight month of manufacturing industry expansion, and a second consecutive month of expansion in the service economy, for relieving some pressure that had been depressing interest rates.
Improvements in the economy, as they trickle down to individual homebuyers, give such individuals more money with which to afford paying higher mortgage rates. At the same time, a stronger economy tends to bolster the Fed's case for the economy being able to survive without monetary stimulus. It increases the chance that the Fed will cut back on its bond-buying program, and allow interest rates to return to more normal levels.
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