Mortgage rates jumped this week on stronger-than-expected economic reports, according to Freddie Mac's weekly survey.
The 30-year, fixed-rate loan, the most popular product for homebuyers, rose to 4.46% from 4.29% last week. The average rate on a 15-year, fixed-rate mortgage, typically used for refinancing higher interest mortgages, also jumped 0.17 percentage point to 3.47%.
This week's rate approached a high for the year. Rates on the 30-year have ranged from a low of 3.34% in the first week of January to a high of 4.58% in August.
Frank Nothaft, Freddie's chief economist, cited job creation as a prime reason for the rate spike.
"Private companies added 215,000 new jobs in November according to the ADP employment report, well above the consensus," he said. "In addition, revisions added 54,000 jobs in the prior month."
Read more: http://money.cnn.com/2013/12/05/real_estate/mortgage-rate-rise/
The option of refinancing your mortgage offers advantages.
Once you have a mortgage you’re not locked into it until your home is completely paid off. You always have the option of refinancing the loan and in some cases it might be in your best interests because of the perks involved. It’s definitely something to keep in mind and if you’ve not even thought about it yet we can look at some of the reasons why you should. If you think your life will improve for the better you should go and speak to someone about it after reading this.
Shorten the term of your loan
When most people take out a mortgage they are young and they aren’t making a lot of money. Fast forward a few years and they’re making a little more plus the interest rates could have dropped a considerable amount. If you enter your details into a mortgage calculator you might find because of the lower interest rates you could easily reduce the term of your mortgage and it wouldn’t cost you much more per month. It’s definitely worth considering if you can afford it because life is better when your mortgage has been paid off.
Lower your interest rate
Sometimes it’s not nice looking at the money coming out of your bank account every month because you know deep down you should be paying a lot less. Always be open to the possibility of refinancing your mortgage if you can get a lower interest rate because over the life of your mortgage it could save you tens of thousands of dollars. It’s better in your pocket than the bank’s especially when you realize you can save all that money by simply filling out a few forms.
Reduce your monthly payment
You know you’re in trouble when the ground opens up and starts swallowing you. That is how some people feel when they can’t afford their mortgage payments no matter what they do. Maybe your interest rate shot up or you had your hours cut back at work, but no matter the reason it might be a good idea to refinance your mortgage in order to reduce your monthly repayments. When less money is coming out of your account each month it means you have more of a safety net.
Switch to a different loan
If you signed up to the wrong type mortgage in the first place it might be a good idea to find out how to claw yourself out of the hole you find yourself in. Some people decide to take out an adjustable-rate mortgage because fixed-rate ones didn’t look so good at the time, but as soon as things change for the worst it might be time to refinance your mortgage to jump onto something else. Fixed-rate mortgages are a lot better when the interest rate is low because you’ll find it much easier to juggle your finances.
In order to treat yourself
The last reason you might want to refinance your mortgage is because you want to treat yourself to an expensive gift. If your home is getting old it might need major renovations carried out and refinancing could be the only way you can get that sort of money together. You could take some money to start your own business or you could put a deposit down on a rental home. If you decide to take any money out of your home it must be for a good reason or it’s not worth it.What are you thinking?
Do you think now is a good time to look more deeply at your refinancing options? If you don’t do something about it now you could be losing money each and every month. It’s not actually too hard to sort out and you’ll not lose your hair because of the stress involved, so just do something before you forget.
Real-estate website Zillow Inc. Z -2.93% said its real-time rate on 30-year fixed-rate mortgages increased in the latest week, rising for a second straight week.
The 30-year fixed-mortgage rate on Zillow's Mortgage Marketplace, which tracks mortgages on the company's website, was up at 4.25% from 4.14% a week earlier.
Although Federal Reserve Chairman Ben Bernanke has said the central bank is committed to keeping short-term interest rates low for an extended period, Zillow expects upward pressure and volatility in mortgage rates, according to Svenja Gudell, economic research director at Zillow.
"This week will bring more movement as a lot of important economic data is set to be released," Ms. Gudell said.
Zillow said the rate for a 15-year fixed home loan was 3.22% compared with 3.13% last week. The rate for a 5-1 adjustable-rate mortgage was 2.72%, unchanged from the previous week. A 5-1 ARM has an initial rate that applies for the first five years of the loan and then adjusts annually.
Zillow's real-time mortgage rates are based on thousands of custom mortgage quotes submitted daily to anonymous borrowers through the company's website.
WASHINGTON — Average U.S. mortgage rates rose modestly this week, a move that makes home-buying a bit less affordable. Still, rates remain near historically low levels.
Mortgage buyer Freddie Mac said Wednesday that the average rate on the 30-year loan increased to 4.29 percent from 4.22 percent last week.
The average on the 15-year fixed-rate loan ticked up to 3.3 percent from 3.27 percent.
Rates have risen nearly a full percentage point since May after the Federal Reserve signaled it might slow its bond purchases by the end of the year.
Rates peaked at nearly 4.6 percent in August. But the Fed held off in September and most analysts expect it won’t move until next year.
The increase in mortgage rates has contributed to a slowdown in home sales over the past two months.
To calculate average mortgage rates, Freddie Mac surveys lenders across the country at the beginning of 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 percent of the loan amount.
The average fee for a 30-year mortgage was unchanged at 0.7 point. The fee for a 15-year loan also was unchanged at 0.7 point.
The average rate on a one-year adjustable-rate mortgage edged down to 2.6 percent, from 2.61 percent last week. The fee was unchanged at 0.4 point.
The average rate on a five-year adjustable mortgage edged down to 2.94 percent this week, from 2.95 percent last week.
The fee was unchanged at 0.5 point.
The Mortgage Bankers Association (MBA) released its weekly report on mortgage applications Wednesday morning, noting a decrease of 2.3% in the group’s seasonally adjusted composite index, following a drop of 1.8% for the previous week. Mortgage loan rates increased slightly on two loan types while one was unchanged and the fourth fell slightly.
Changes in both applications and mortgage rates continue to be relatively small. In the past couple of years, refinancing often picked up the slack in mortgage lending, but with the lending market coming off record lows, homeowners who were going to refinance have already done so, and the rest are either waiting for rates to fall or for their homes to increase in value enough to make a refinance worth it.
The seasonally adjusted purchase index increased by 6% from last week’s report. On an unadjusted basis, the composite index decreased by 13% week-over-week. The unadjusted purchase index decreased by 8% for the week, and is 3% lower year-over-year. This marks the eighth week in a row that the year-over-year unadjusted purchase index is lower than or equal to its level of a year ago.
The MBA’s refinance index decreased by 7% after dropping by 2% in the previous week. The share of refinancings fell by two points, totaling 64% of all applications. Adjustable rate mortgage loans account for 7% of all applications, unchanged from the prior week.
The average mortgage loan rate for a conforming 30-year fixed-rate mortgage increased from 4.44% to 4.46%. The rate for a jumbo 30-year fixed-rate mortgage fell from 4.48% to 4.47%. The average interest rate for a 15-year fixed-rate mortgage remained unchanged at 3.52%.
The contract interest rate for a 5/1 adjustable rate mortgage loan rose from 3.11% to 3.12%.
Mortgage rates ticked higher for the second straight week following consecutive weeks of decline, according to new data released Thursday by Freddie Mac.
The 30-year fixed-rate average surged from 4.16 percent to 4.35 percent, with an average 0.7 point. It is up from 3.34 percent at this point last year and has remained about 4 percent since the end of June.
The 15-year average edged up more modestly, from 3.27 percent last week to 3.35 percent, also with an average 0.7 point. One year ago, those mortgages averaged 2.65 percent.
The five-year hybrid adjustable-rate average rounded out the increases, sliding up to 3.01 percent from 2.96 percent. The one-year hybrids held steady last week at an average of 2.61 percent, and both hybrid averages are up marginally compared to this time last year.
Frank E. Nothaft, Freddie Mac’s vice president and chief economist, pinned the rise to better-than-expected employment numbers for October.
“Fixed mortgage rates increased this week following stronger than expected economic data releases,” he said in a statement. “Nonfarm payrolls increased by 204,000 in October, above the consensus forecast. In addition, revisions added 60,000 additional jobs to the prior two month releases.”
Nothaft noted that the Department of Commerce’s preliminary GDP growth estimates for the third quarter also topped expectations, signaling a strengthening economy and pushing the rates slightly higher.
On Wednesday, meanwhile, the Mortgage Bankers Association reported that the number of mortgage applications slid last week, down 1.8 percent from last week. That is the second straight week of decline, though last week’s tumble was revised from a 7.0-percent drop to a more modest 2.8-percent drop.
MBA’s Refinance Index also decreased 2 percent from the previous week, while its Purchase Index inched down 1 percent.