Mortgage rates rise slightly, Freddie Mac says
Mortgage rates crept higher this week but the 30-year fixed loan remained under 5%, according to Freddie Mac's survey of what lenders were offering to well-qualified buyers with 20% down payments and refinancers with 20% equity in their homes.
The government-controlled housing finance firm said the interest rate for a 30-year fixed-rate mortgage averaged 4.86% for borrowers who paid lenders 0.7% of the loan amount in fees and discount points. That was up from 4.81% last week and 4.76% the week before that. The rate rose above 5% briefly in February.
This week's average for a 15-year fixed-rate mortgage was 4.09%, up from 4.04% a week earlier. The start rate on variable loans with a fixed rate for the first five years was 3.70% compared with last week's 3.62%.
Freddie Mac economist Frank Nothaft said "relatively benign" inflation reports were keeping home-loan rates low by historical standards, but that wasn't enough to prop up home prices, which were falling as a result of large numbers of distress sales.
Foreclosures are expected to increase this year as loan servicers lift the moratoriums imposed because of improper handling of delinquencies and home seizures. That would tend to put more downward pressure on home prices as the large backlog of distressed mortgages works its way through the system.
-- E. Scott Reckard
Photo: Freddie Mac headquarters in McLean, Va. Credit: Freddie Mac