We have been warning about the mortgage rates going up. Of course, it is only one week and it does not make a trend. But with inflation and risks (especially in mortgage markets) going up, investors have to get more for their investments.
Last week, the fixed-loan averaged 6.04%. It went from 5.72% to 6.04% in a week. That is about 25 basis points in a week.
The rate is down from last year when the rate wa 6.22%.
"After trending up in the past two weeks, long-term fixed mortgage rates are back up to nearly where they were at the beginning of the year. In contrast, average rates on adjustable-rate mortgages are about 0.5 percentage points below levels of the first week of this year," said Frank Nothaft, Freddie Mac vice president and chief economist. "As the spread between long-term fixed-rates and adjustable-rates widens, it's possible we could see a slight increase in the popularity of adjustable-rate mortgages."
Have we not learned anything? While Nothaft is not recommending ARMS (the way Greenspan did), I hope people have learned their lesson with ARM mortgages.
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