Mortgage rates rise 4th week in a row (April 2007)
Mortgage rates have risen for the fourth week in a row and are near where they were in mid-February.
The benchmark 30-year fixed-rate mortgage rose 6 basis points to 6.31 percent, according to the Bankrate.com national survey of large lenders. A basis point is one-hundredth of 1 percentage point. The mortgages in this week's survey had an average total of 0.27 discount and origination points. One year ago, the mortgage index was 6.56 percent; four weeks ago, it was 6.16 percent. On Feb. 14, it was 6.32 percent, and it hasn't been that high since.
The 15-year fixed-rate mortgage rose 7 basis points to 6.04 percent. The 5/1 adjustable-rate mortgage rose 5 basis points to 6.17 percent.
This week, the March employment report caused rates to rise. The Labor Department announced Friday that nonfarm payrolls grew by 180,000 in March. That was quite a bit better than the 135,000 that had been expected. The unemployment rate fell, too, to 4.4 percent.
| Weekly national mortgage survey
| | | | | Results of Bankrate.com's April 11, 2007, weekly national survey of large lenders and the effect on monthly payments for a $165,000 loan:
| | |
| 30-year fixed
| 15-year fixed
| 5-year ARM
| This week's rate:
| 6.31%
| 6.04%
| 6.17%
| Change from last week:
| +0.06
| +0.07
| +0.05
| Monthly payment:
| $1,022.38
| $1,395.93
| $1,007.36
| Change from last week:
| +$6.45
| +$6.24
| +$5.34
|
Job news sparks mortgage rate increase. Better-than-expected employment news translated into an immediate bump in Treasury yields and long-term interest rates as investors pulled money out of bonds and put them into stocks. To lure buyers, bond prices fell and yields rose -- and those higher yields filtered into the mortgage market, resulting in higher rates for home loans.
Bankrate's weekly survey was completed before the Wednesday afternoon release of the minutes of the Federal Reserve's March 20-21 rate policy meeting. Those meeting minutes probably would have boosted the Bankrate index even higher, because they showed that members of the Fed's rate-setting committee are worried about inflation.
According to the minutes, the rate-setting panel's members believed that "the prevailing level of inflation remained uncomfortably high, and the latest information cast some doubt on whether core inflation was on the expected downward path. Most participants continued to expect that core inflation would slow gradually, but the recent readings on inflation and productivity growth, along with higher energy prices, had increased the odds that inflation would fail to moderate as expected; that risk remained the Committee's predominant concern."
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