February 14, 2018 in Mortgages
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Mortgage rates rose for the sixth week in a row, according to Bankrate’s weekly survey of lenders. The 30-year fixed-rate mortgage climbed 7 basis points to 4.51 percent. That’s the highest point for the 30-year fixed since April 2, 2014, when the average rate was 4.54 percent.

Meanwhile, the housing market isn’t showing any love to potential homebuyers this week as inflation fears and market jeers added additional pressure to mortgage rates. The Consumer Price Index, released Tuesday, showed higher prices than expected. That, combined with lingering jitters from last week’s volatile stock market are likely responsible for the dip in this week’s mortgage applications. 

Although mortgage applications decreased 4.1 percent from one week earlier, according to data from the Mortgage Bankers Association, they’re still showing a double-digit increase from this time last year.

“Mortgage applications for new homes surged in January and were up 18 percent on a year-over-year basis,” said Lynn Fisher, MBA Vice President of Research and Economics. “This complements other positive news on U.S. job growth suggesting that economic fundamentals are strong.”

Rising bonds and benchmark rates

The 10-Year Treasury yield rose to a four-year high Monday to 2.88 percent, causing mortgage interest rates to continue their ascent. Although there was a brief dip down to 2.85 percent, this was widely assumed to be caused by an improvement in the 30-year mortgage-backed securities market.

Many experts feel that rates will continue this upward trend because of increasing pressure on the bond market, combined with the expectation that the Federal Reserve will raise their benchmark federal funds rate several times over the course of 2018.

The benchmark 30-year fixed-rate mortgage rose this week to 4.51 percent from 4.44 percent, according to Bankrate’s weekly survey of large lenders. A year ago, it was 4.35 percent. Four weeks ago, the rate was 4.20 percent. The 30-year fixed-rate average for this week is the same as the 52-week high of 4.51 percent, and is 0.56 percentage points above the 52-week low of 3.95 percent.

The 30-year fixed mortgages in this week’s survey had an average total of 0.29 discount and origination points.

Over the past 52 weeks, the 30-year fixed has averaged 4.15 percent. This week’s rate is 0.36 percentage points higher than the 52-week average.

  • The 15-year fixed-rate mortgage rose to 3.90 percent from 3.87 percent.
  • The 5/1 adjustable-rate mortgage fell to 3.93 percent from 3.94 percent.
  • The 30-year fixed-rate jumbo mortgage rose to 4.45 percent from 4.38 percent.

At the current 30-year fixed rate, you’ll pay $507.28 each month for every $100,000 you borrow, up from $503.13 last week.

At the current 15-year fixed rate, you’ll pay $734.69 each month for every $100,000 you borrow, up from $733.19 last week.

At the current 5/1 ARM rate, you’ll pay $473.39 each month for every $100,000 you borrow, down from $473.96 last week.

Results of Bankrate.com’s weekly national survey of large lenders conducted Feb. 14, 2018, and the effect on monthly payments for a $165,000 loan:

Weekly national mortgage survey
Breakdown 30-year fixed 15-year fixed 5-year ARM
This week’s rate: 4.51% 3.90% 3.93%
Change from last week: +0.07 +0.03 -0.01
Monthly payment: $837.01 $1,212.23 $781.09
Change from last week: +$6.85 +$2.47 -$0.95