In an uptick that could herald a sustained rise in mortgage rates , the average rate on the benchmark 30-year mortgage rose this week to 3.16 percent from last week’s 3.13 percent, according to Bankrate’s weekly survey of large lenders.
A year ago, the average rate on a 30-year fixed-rate mortgage was 3.43 percent. Four weeks ago, the rate was 3.18 percent. The 30-year home loan average for this week is 0.26 percentage points below the 52-week high of 3.42 percent, and is 0.23 percentage points higher than the 52-week low of 2.93 percent.
The 30-year fixed mortgages in this week’s survey had an average total of 0.34 discount and origination points.
Over the past 52 weeks, the 30-year fixed has averaged 3.14 percent. This week’s rate is 0.02 percentage points higher than the 52-week average.
- The 15-year fixed-rate mortgage fell to 2.42 percent from 2.44 percent.
- The 5/1 adjustable-rate mortgage rose to 3.30 percent from 3.10 percent.
- The 30-year fixed-rate jumbo mortgage fell to 3.21 percent from 3.31 percent.
At the current 30-year fixed rate, you’ll pay $430.28 each month for every $100,000 you borrow, up from $428.65 last week.
At the current 15-year fixed rate, you’ll pay $663.03 each month for every $100,000 you borrow, down from $663.97 last week.
At the current 5/1 ARM rate, you’ll pay $437.96 each month for every $100,000 you borrow, up from $427.02 last week.
Results of Bankrate.com’s weekly national survey of large lenders conducted June 16, and the effect on monthly payments for a $165,000 loan:
| Breakdown | 30-year fixed | 15-year fixed | 5-year ARM |
|---|---|---|---|
| This week’s rate: | 3.16% | 2.42% | 3.30% |
| Change from last week: | +0.03 | -0.02 | +0.20 |
| Monthly payment: | $709.97 | $1,094.00 | $722.63 |
| Change from last week: | +$2.70 | -$1.55 | +$18.05 |
Where mortgage rates are headed
Mortgage experts offer mixed predictions about the future of rates. In Bankrate’s survey this week (June 17-23), 58 percent said rates will go up while 25 percent said rates will go down and just 17 percent expect them to stay the same.
Meanwhile, Mike Fratantoni, chief economist at the Mortgage Bankers Association, said the Federal Reserve seems poised to dial back its support of bonds and mortgage-backed securities, a move known by dismal scientists as tapering. “While the Fed has not yet laid out specific plans with respect to tapering their Treasury and MBS purchases, the changes in their forecasts for the economy, and for their rate target, suggests that tapering is close at hand,” Fratantoni said Wednesday. “As a result, mortgage rates are likely primed to move at least somewhat higher.”
Refinances are a great deal with rates this low
Rates are a cut above the record lows reached earlier this year, but refinancing remains a historically excellent deal. While the rate on 10-year bonds issued by the U.S. government had hovered around 1.5 percent in recent days, it was up to 1.57 percent Wednesday. The 10-year Treasury is closely tied to 30-year mortgage rates.
The recent ups and downs in rates represent little more than “bouncing along the bottom,” says Mark Fleming, chief economist at First American Financial Corp., a large title insurer. “Anything below 3.5 percent is by any historic standard an amazing mortgage rate,” he said Wednesday.
As mortgage rates make a predicted slow climb to the 3.5 percent range by year’s end, decreased purchasing power might ease some of the pressure on home prices as marginal buyers are pushed out of the market, but competition will still be intense among those who can still afford to buy. Those looking to refinance should be able to find good deals for the rest of the year, though at rates at bit higher than the current level.
The bottom line: If you see a rate that fits your needs and budget, it may be time to do that refinance now.
The Bankrate.com national survey of large lenders is conducted weekly. To conduct the National Average survey, Bankrate obtains rate information from the 10 largest banks and thrifts in 10 large U.S. markets. In the Bankrate.com national survey, our Market Analysis team gathers rates and/or yields on banking deposits, loans and mortgages. We’ve conducted this survey in the same manner for more than 30 years, and because it’s consistently done the way it is, it gives an accurate national apples-to-apples comparison. Our rates differ from other national surveys, in particular Freddie Mac’s weekly published rates. Each week Freddie Mac surveys lenders on the rates and points based on first-lien prime conventional conforming home purchase mortgages with a loan-to-value of 80 percent. “Lenders surveyed each week are a mix of lender types – thrifts, credit unions, commercial banks and mortgage lending companies – is roughly proportional to the level of mortgage business that each type commands nationwide,” according to Freddie Mac.
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