Mortgage Rates Rise as Home Sales Surge

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WASHINGTON -- Average U.S. rates on fixed mortgages rose for a third straight week as new data showed a surprisingly strong pace of new-home sales last month. Rates still remain near historically low levels.

Mortgage buyer Freddie Mac said Thursday the average rate for the 30-year loan increased to 4.37 percent from 4.33 percent last week. The average for the 15-year mortgage rose to 3.39 percent from 3.35 percent.

A report Wednesday from the Commerce Department boosted expectations that the spring home buying season will be solid enough to lift the overall economy.

Sales of new homes rebounded in January to the fastest rate in more than five years.
The strength in purchases followed a slowdown that had been linked to higher mortgage rates and severe winter weather.

Mortgage rates have risen about a full percentage point since hitting record lows roughly a year ago. The increase was driven by speculation that the Federal Reserve would reduce its $85 billion-a-month bond purchases. Deeming the economy to be gaining strength, the Fed proceeded last month with planned reductions of its bond purchases, which have helped keep long-term interest rates low.

To calculate average mortgage rates, Freddie Mac surveys lenders across the country 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 a 30-year mortgage was unchanged at 0.7 point. The fee for a 15-year loan also remained at 0.7 point.
  • The average rate on a one-year adjustable-rate mortgage fell to 2.52 percent from 2.57 percent. The average fee increased to 0.4 point from 0.3 point.
  • The average rate on a five-year adjustable mortgage declined to 3.05 percent from 3.08 percent. The fee held at 0.5 point.


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createidea

A report Wednesday from the Commerce Department boosted expectations that the spring home buying season will be solid enough to lift the overall economy...

Well if the Commerce Department sez so than it must be true.

LOL !!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!

February 27 2014 at 1:36 PM Report abuse +1 rate up rate down Reply
1 reply to createidea's comment
darbrow717

Yea, just a couple days ago there was articles about how bad the housing market is. Someone is lying!!

February 27 2014 at 2:47 PM Report abuse +2 rate up rate down Reply
2 replies to darbrow717's comment
vlady1000

My thoughts too. The media loves to make a mountain out of a mole hole for attention

February 27 2014 at 11:01 PM Report abuse rate up rate down
vlady1000

So a few days ago you should have been buying and today you should be selling!!! Like day trading, only in RE.

February 27 2014 at 11:02 PM Report abuse rate up rate down