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<< Previous   of   Next >>   ADVERTISEMENT   CONTACT THE HERALD Mike Benbow, Business Editor benbow@heraldnet.com   Published: Sunday, June 7, 2009 Home loan rates climb back above 5 percent Associated Press WASHINGTON -- Rates on 30-year home loans surged above 5 percent for the first time in nearly three months this week as investors pushed up rates on long-term government debt, which is closely tied to mortgage rates. Mortgage finance giant Freddie Mac said Thursday that average rates on 30-year, fixed-rate mortgages rose to 5.29 percent this week, from an average of 4.91 percent a week earlier. It was the highest weekly average in nearly six months and the first time rates were above 5 percent since the week of March 12, when they hit 5.03 percent. Mortgage rates "caught up to the recent rise in long-term bond yields this week," Frank Nothaft, Freddie Mac vice president and chief economist, said in a statement. The jump in rates came after the yield on the benchmark 10-year Treasury note, a barometer for interest rates on mortgages and other loans, jumped last week to a six-month high of 3.75 percent. But yields on long-term Treasury debt have since edged back downward following lackluster economic reports. While signs are building that the battered U.S. housing market is beginning to stabilize, higher rates could endanger any recovery, since borrowers would be able to borrow less money and might decide to hold off on their purchases. Mortgage applications fell 35 percent last week from a week earlier, the Mortgage Bankers Association said Wednesday. Applications to refinance existing loans, which had made up about three quarters of mortgage applications earlier this spring, fell to about 60 percent of loan volume. Freddie Mac collects mortgage rates on Monday through Wednesday of each week from lenders around the country. Rates often fluctuate significantly, even within a given day. The average rate on a 15-year, fixed-rate mortgage rose to 4.79 percent this week from 4.53 percent, according to Freddie Mac. Rates on five-year, adjustable-rate mortgages inched up to 4.85 percent from 4.82 percent last week. Rates on one-year, ­adjustable-rate mortgages rose to 4.81 percent from 4.69 percent. The rates do not include add-on fees known as points. The nationwide fee averaged 0.7 point last week for 30-year and 15-year mortgages, and averaged 0.6 point for five-year and one-year adjustable-rate loans. Send your real estate news to Mike Benbow, Business editor, The Herald, P.O. Box 930, Everett, WA 98206, by fax to 425-339-3435 or by e-mail to economy@heraldnet.com. READER COMMENTS Be the first to comment. You must be a registered user and verify your e-mail address to post comments to blogs or articles on HeraldNet. To register, click here. To read other terms and conditions, click here. Log out

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