US rate on 30-year mortgages rises to 3.59 pct. - KMSP-TV

US rate on 30-year mortgages rises to 3.59 pct.

Posted: Updated:

WASHINGTON (AP) -- Average rates on fixed mortgage rose for the third straight week, hitting their highest levels since mid-March. Still, mortgage rates remained close to historic lows, a trend that should help sustain the housing recovery.

Mortgage buyer Freddie Mac said Thursday that the average rate for the 30-year loan increased to 3.59 percent this week. That's up from 3.51 percent last week and above the rate of 3.31 percent reached in November, the lowest on records dating to 1971.

The average on the 15-year loan jumped to 2.77 percent. That's up from 2.69 percent last week. The record low of 2.56 percent was hit on May 2.

Cheaper mortgages are a key reason home sales have increased this year.

In April, sales of previously occupied homes rose at the fastest pace in three and a half years, the National Association of Realtors reported Wednesday. And sales of newly built homes jumped to the second-highest rate since July 2008.

More demand, along with a tight supply of homes for sale, has helped boost home prices. It has also encouraged builders to break ground on more homes.

Mortgage rates rose sharply this week because they tend to track the yield on the 10-year Treasury note.

The yield rose above 2 percent Wednesday for the first time since March 14 and was at 2.02 percent Thursday. Investors began selling government bonds Wednesday after minutes of the Federal Reserve's last meeting showed several policymakers favored slowing the Fed's bond purchases, perhaps as early as this summer.

The Fed is buying $85 billion a month in Treasury and mortgage bonds, which has pushed down long-term interest rates. Once it slows the bond purchases, interest rates are likely to tick up. That would decrease the value of bonds with lower yields.

To calculate average mortgage rates, Freddie Mac surveys lenders across the country on Monday through Wednesday 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 30-year mortgages was unchanged at 0.7 point last week. The fee for 15-year loans also was steady at 0.7 point.

The average rate on a one-year adjustable-rate mortgage held at 2.55 percent. The fee for one-year adjustable-rate loans was unchanged at 0.4 point.

The average rate on a five-year adjustable-rate mortgage edged up to 2.63 percent from 2.62 percent. The fee was steady at 0.5.

  • Your MoneyMore>>

  • Home Depot probes possible credit card data breach

    Home Depot probes possible credit card data breach

    Tuesday, September 2 2014 5:29 PM EDT2014-09-02 21:29:43 GMT
    Home Depot may be the latest retailer to suffer a credit card data breach.  The Atlanta-based home improvement retailer told The Associated Press Tuesday that it is looking into "unusual activity" and working with both banks and law enforcement.
    Home Depot may be the latest retailer to suffer a credit card data breach.  The Atlanta-based home improvement retailer told The Associated Press Tuesday that it is looking into "unusual activity" and working with both banks and law enforcement.
  • Some fear auto industry returning to bad habits

    Some fear auto industry returning to bad habits

    Tuesday, September 2 2014 3:29 PM EDT2014-09-02 19:29:56 GMT
    Big discounts. Six- or seven-year loans, in some cases to buyers who would have been turned down in the past.  As the auto industry strives to sustain its post-recession comeback, car companies are resorting to tactics that some experts warn will lead to trouble down the road.
    Big discounts. Six- or seven-year loans, in some cases to buyers who would have been turned down in the past.  As the auto industry strives to sustain its post-recession comeback, car companies are resorting to tactics that some experts warn will lead to trouble down the road.
  • Business is good at Coney Island

    Business is good at Coney Island

    Friday, August 29 2014 10:22 PM EDT2014-08-30 02:22:32 GMT
    From the brand-new Thunderbolt roller coaster to the world-famous boardwalk, tourists and business owners alike say Coney Island had a great ride of its own this summer. Toms Coney Island's general manager Vasilios Tourlokas says the mild summer impacted his boardwalk business in the best way possible: a 10 to 15 percent increase.
    From the brand-new Thunderbolt roller coaster to the world-famous boardwalk, tourists and business owners alike say Coney Island had a great ride of its own this summer. Toms Coney Island's general manager Vasilios Tourlokas says the mild summer impacted his boardwalk business in the best way possible: a 10 to 15 percent increase.
Powered by WorldNow

KMSP-TV
11358 Viking Drive
Eden Prairie, MN 55344

Phone: (952) 944-9999
Fax: (952) 942-0455

Didn't find what you were looking for?
All content © Copyright 2000 - 2014 Fox Television Stations, Inc. and Worldnow. All Rights Reserved.
Privacy Policy | New Terms of Service What's new | Ad Choices