Mortgage loan rates higher for fifth week

Interest rates for the week of December 16th rose to 4.83 percent for 30-year fixed-rate financing according to Freddie Mac. This was the fifth week in a row where fixed-rate mortgage rates were up — in fact, rates have risen .66 percent — two-thirds of a percent — since November 11th when the interest cost for the same fixed-rate loan was 4.17 percent.

According to Frank Nothaft, Freddie Mac’s chief economist, “market concerns over stronger economic growth that, in the near term, could lead to an increase in inflation have sparked a rise in bond yields and mortgage rates have followed. For instance, the growth in retail sales excluding automobiles in November was twice that of the market consensus forecast. Industrial production showed the biggest gain in November since July, according to the Federal Reserve Board. And consumer sentiment, as measured by the Thomson Reuters/University of Michigan index, rose to a six-month high in December. As a result, interest rates for 30-year fixed mortgages this week were the highest since the week of May 20th of this year.”

At the same time, and not to be a downer, unemployment is at 9.8 percent according to official figures from the Labor Department. The actual percentage is higher according to the manner in which most humans define the term unemployment.

The interest cost for a 15-year fixed-rate loan averaged 4.17 percent. A year ago the 15-year FRM averaged 4.38 percent.

The 5-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) averaged 3.77 percent, still below the 4.37 percent average from a year ago.

The 1-year Treasury-indexed ARM averaged 3.35 percent compared with 4.34 percent last year.

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