Borrowing costs are increasing, but home buyers can still snag an interest rate that is lower than a year ago.
“This week’s survey reflects last week’s uptick in long-term interest rates, with the 30-year fixed mortgage rate up 4 basis points to 3.94 percent,” says Len Kiefer, Freddie Mac’s deputy chief economist. “The 30-year mortgage rate has been bouncing around in a 10 basis point range since September. While long-term rates have been relatively steady week-to-week, shorter term interest rates have been on the rise. The spread between the 30-year fixed mortgage and the 5/1 Hybrid ARM rate was 59 basis points this week, down 43 basis points from earlier this year. With a narrower spread between fixed and adjustable mortgage rates, more borrowers are opting for a fixed product.”
The Mortgage Bankers Association reported this week that the ARM share of conventional mortgage applications was 16.7 percent, down from more than 20 percent in the spring.
Freddie Mac reports the following national averages with mortgage rates for the week ending Dec. 7:
30-year fixed-rate mortgages: averaged 3.94 percent, with an average 0.5 point, increasing from last week’s 3.90 percent average. Last year at this time, 30-year rates averaged 4.13 percent.
15-year fixed-rate mortgages: averaged 3.36 percent, with an average 0.5 point, increasing from last week’s 3.30 percent average. A year ago, 15-year rates averaged 3.36 percent.
5-year hybrid adjustable-rate mortgages: averaged 3.35 percent, with an average 0.3 point, rising from last week’s 3.32 percent average. A year ago, 5-year ARMs averaged 3.17 percent.