WASHINGTON (AP) — Rates for 30-year home loans have inched up, hitting 5 percent for the first time in nearly a month after bond yields edged up.
The average rate on a 30-year fixed mortgage was 5 percent this week, up from 4.92 percent a week earlier, mortgage company Freddie Mac said Thursday. It was the highest average since the week of September 24, when rates averaged 5.04 percent.
While above the record low of 4.78 percent hit in the spring, rates are still attractive for people looking to buy a home or refinance.
To prop up the housing market and help the economy recover from the worst recession since the 1930s, the Federal Reserve has been engaged in an extraordinary level of support, spending $1.25 trillion on mortgage-backed securities, which has driven down rates on home loans.
Last month, Fed Chairman Ben Bernanke and his colleagues agreed to slow down the pace of the program to buy mortgage securities from Fannie Mae and Freddie Mac. Instead of wrapping up the purchases by the end of this year, the Fed now plans to do so by the end of March.
Despite the government's effort to support the housing market, qualifying for a loan is still tough. Lenders have tightened their standards dramatically, so the best rates are available to those with solid credit and a 20 percent down payment.
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, often in line with long-term Treasury bonds.
The average rate on a 15-year fixed-rate mortgage rose to 4.43 percent, from 4.37 percent last week, according to Freddie Mac.
Rates on five-year, adjustable-rate mortgages averaged 4.4 percent, up from 4.38 percent a week earlier. Rates on one-year, adjustable-rate mortgages fell to 4.54 percent from 4.6 percent.
The rates do not include add-on fees known as points. The nationwide fee for loans in Freddie Mac's survey averaged 0.7 points for 30-year loans. The fee averaged 0.6 points for 15-year, five-year and one-year loans.
Copyright 2009 The Associated Press.
