Bankrate: Mortgage Rates Hover at Multi-year High

Fixed mortgage rates dipped slightly, one week after hitting the highest point since Sept. 2003. The average 30-year fixed rate mortgage is now 6.43 percent, according to Bankrate.com’s weekly national survey of large lenders. The 30-year fixed rate mortgages in this week’s survey had an average of 0.32 discount and origination points.

The average 15-year fixed mortgage rate ticked lower, from 6.09 percent to 6.08 percent, and the average jumbo 30-year fixed rate slipped from 6.63 percent to 6.6 percent. Adjustable rate mortgages were mixed, with the average 5/1 adjustable rate mortgage slumping from 6.13 percent to 6.07 percent, while the average one-year ARM climbed from 5.76 percent to 5.79 percent.

Mortgage rates took a breath after a larger-than-expected decline in February retail sales. Since retail sales are the pulse of consumer spending, any drop-off stokes fears of a slowing economy. Yields on bonds, including government-issued and mortgage-backed securities, fell as expected. But record trade and current account deficits counteracted any increased demand for bonds, so mortgage rates moved only slightly. Fixed mortgage rates for each of the past two weeks remain higher than any other week dating back to Sept. 2003.

Mortgage rates are approximately six-tenths of a percentage point higher than six months ago. In mid-September, the average 30-year fixed mortgage rate was 5.84 percent, meaning that the monthly payment on a loan of $165,000 was $972.35. With the average 30-year fixed rate at 6.43 percent, the same loan originated now would carry a payment of $1,035.33. Although fixed mortgage rates are higher than six months ago, the increase is still less than what is facing many adjustable rate mortgage borrowers. Fixed mortgage rates remain an attractive refinancing alternative for adjustable rate borrowers.

Bankrate’s national weekly mortgage survey is conducted each Wednesday from data provided by the top 10 banks and thrifts in the top 10 markets.

For a full analysis of this week’s move in mortgage rates, go to: http://www.bankrate.com/mortgagerates.