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Freddie Mac, Bankrate: Mortgage rates move higher
By Palm Beach Business.com
DELRAY BEACH — Mortgage rates moved upward from their record lows over the past week in large measure because of the latest solution to the European debt crisis and some mixed economic data.
Freddie Mac’s Primary Mortgage Market Survey found the 30-year fixed-rate mortgage jumping to 3.55 percent with 0.7 point from last week’s 3.49 percent. A year ago, rates were at a seemingly low 4.39 percent.
Bankrate had the 30-year moving slightly higher, to 3.77 percent with 0.44 point from 3.75 percent a week earlier.
"Recent announcements of additional debt relief for the Eurozone and mixed domestic economic indicators added upward pressure on Treasury yields as well as mortgage rates this week,” Freddie Mac Chief Economist Frank Nothaft said.
“The U.S. economy grew at a 1.5 percent annualized rate in the second quarter, slower than the 2.0 percent growth in the first quarter with consumer spending in June unchanged from May. However, consumer confidence rose in July for the first time in five months according to the Conference Board.”
Mortgage rates tend to move with Treasury yields, particularly the 10-year bond. Yields tend to rise with good economic news as investors move their money out of bonds and into stocks.
The two surveys were mixed on the 15-year fixed-rate mortgage, with Freddie Mac reporting a rise to 2.83 percent with 0.6 point from last week’s 2.80 percent, and Bankrate reporting a decline to 2.99 percent with 0.37 point from 3.00 percent a week ago.
Bankrate noted that the last time mortgage rates have been below 6 percent since November 2008, when the 30-year averaged 6.33 percent. At that rate $200,000 loan would have carried a monthly payment of $1,241.86. At Bankrate’s average rate now of 3.77 percent, the same loan would have a monthly payment of $928.50, a difference of $313.
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