Mortgage rates edge higher after 3 weeks of declines

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Fixed rates on home loans edged higher this week after three weeks of declines, Freddie Mac said in its latest survey.

Lenders told the big mortgage finance company that they were offering 30-year fixed rate mortgages at an average of 4.21% to well-qualified borrowers who paid 0.8% of the loan amount in upfront lender fees and discount points.

That was up from 4.19% the previous week, which Freddie said was the lowest long-term mortgage rate since 1951. A year ago, the average rate in the survey was an even 5%.

Fifteen-year fixed mortgages, mainly a refinance option enabling homeowners to pay off their loans faster, were averaging 3.64% with 0.7% in lender fees, up from 3.62% the prior week.

The five-year Treasury-indexed hybrid adjustable loan -- it has a fixed rate for five years and then becomes variable -- was at a start rate of 3.45% this week with 0.6% in lender fees, down from 3.47% last week. That was the lowest start rate for such loans since Freddie started tracking them in January 2005.

Freddie Mac asks lenders each week what rates they are offering to well-qualified borrowers with 20% down payments or 20% home equity if they are refinancing. Borrowers who shop around often obtain slightly better rates, and it’s possible to obtain lower rates by paying more upfront. In addition to lender fees, borrowers often wind up paying third-party costs such as appraisals and title insurance.

-- E. Scott Reckard