30-year mortgage rate steady at 4.57%
WASHINGTON (AP) — Average U.S. rates on fixed mortgages held steady this week, hovering near two-year highs. But rates could change quickly next week when the Federal Reserve addresses its bond purchase program.
Mortgage buyer Freddie Mac said Thursday that the average rate on the 30-year loan was unchanged from last week at 4.57%, just below the two-year high of 4.58% reached Aug. 22.
The average on the 15-year fixed mortgage held at 3.59%. The two-year high of 3.60% was hit on Aug. 22.
Long-term mortgage rates have risen more than a full percentage point since May, when Chairman Ben Bernanke first signaled that the Fed could reduce its bond purchases this year. The purchases have been intended to keep long-term loan rates extremely low.
Most analysts expect the Fed to decide at its meeting next week to scale back its bond purchases.
Even with the recent gain, mortgage rates remain low by historical standards. But higher rates have spurred some homebuyers to close deals quickly and could slow the market's momentum if they continue to rise.
Mortgage rates have been rising because they tend to track the yield on the 10-year Treasury note. The yield has climbed 1.3 percentage points in the past four months as bond traders have anticipated that the Fed will slow its bond buying.
The 10-year note's rate was 2.92% on Wednesday, down from 2.97% Tuesday but up from 2.89% a week earlier.
To calculate average mortgage rates, Freddie Mac surveys lenders across the country on Monday through Wednesday each week. The average doesn't include extra fees, known as points, which most borrowers must pay to get the lowest rates. One point equals 1% of the loan amount.
The average fee for a 30-year mortgage rose to 0.8 point from 0.7 point. The fee for a 15-year loan was steady at 0.7 point.
The average rate on a one-year adjustable-rate mortgage fell to 2.67% from 2.71%. The fee declined to 0.4 point from 0.5 point.
The average rate on a five-year adjustable mortgage dipped to 3.22% from 3.28%. The fee was unchanged at 0.5 point.
Curious about mortgage rates or refinancing? Give us a call, we are happy to help.
Steve Hill and Sandra Brenner
Best In Client Satisfaction
Windermere Real Estate
BrennerHill.com
call/text 206-769-9577
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George Runnels
Washington First Mortgage
WaFirstMortgage.com
call/text: 206-604-4545
Should I Wait for Interest Rates to Come Back Down?
Above is a graph of the movement of the 30 year fixed mortgage rate since the beginning of 2012.
Some buyers are waiting to see if interest rates will come back down before making a decision about buying a home. Though no one can guarantee where rates will be in a few months, we don’t believe waiting is a good strategy.
Most experts believe rates may actually move higher. The Mortgage Bankers Association, Fannie Mae, Freddie Mac and the National Association of Realtors are in unison projecting that rates will continue to climb.
With home prices increasing and interest rates projected to also increase, the cost of buying a house could quickly increase rather dramatically.
If you are searching for today's best rates on home mortgages, give George Runnels at Washington First Mortgage a call, he can find you the best terms for new or refinancing a home loan. 206-604-4545
Curious about interest rates and how they can affect your purchasing power? Give us a call or text to learn more.
Steve Hill and Sandra Brenner
Best In Client Satisfaction
Windermere Real Estate
call/text 206-769-9577
BrennerHill.com
Total Increase a Buyer May Pay if They Wait
Earlier in the week, we explained that experts have projected that U.S. home prices will appreciate by approximately 5% in 2013. We also revealed the Mortgage Bankers Association, Fannie Mae and the National Association of Realtors have all projected that the 30-year mortgage rate will be at least 4% by the end of 2013. If we assume that prices and interest rates will rise as projected, here is the monthly difference a buyer may pay if they wait a year.