Mortgage rates are moving away from their historic lows and are now at the highest levels seen in four months. The most recent data announced by Bankrate.com shows that 30-year fixed-rate mortgages are now averaging 4.71 percent.
Rising Interest Rates
The current rate is far below what Americans have seen over the past few years when rates flirted with the 6 percent threshold before beginning their historic plunge. Indeed, rates on many loans dropped below 4 percent for a time earlier this year, presenting a unique opportunity for people to refinance. Unfortunately, a lagging economy and a high number of foreclosures have continued to make home ownership, new home loans and refinancing a more difficult proposition even as we approach 2011.
Bankrate data reveals that the average 15-year fixed mortgage is now at 4.07 percent, and the larger jumbo 30-year is set at 5.29 percent, rising for both. Adjustable rate mortgages were also on the rise, with the average 5-year variable rate mortgage rising to 3.74 percent and the average 7-year variable rate mortgage increasing to 4.08 percent.
November 2008 Peak
When was the last time mortgages were about 6 percent? That would be in Nov. 2008 when the rate peaked at an average rate of 6.33 percent. Bankrate says that means a $200,000 loan would have carried a monthly payment of $1,241.86. Today, with the average rate pegged at 4.71 percent, the monthly payment for the same size loan would be $1,038.48, a savings of $203 per month for the borrower financing today.
If you’re wondering whether rates will continue to increase, then know this: the majority of Bankrate’s own survey of expert panelists (64 percent) believe that mortgage interest rates will continue to rise over the next week. This news may be enough to convince people considering financing a new home or refinancing an existing home to lock in a rate now before rates increase further.
Source: Bankrate.com
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