Mortgage Rates Resume Climb

By:
Peter King | December 30, 2010

Mortgage rates resumed their climb this week, after a brief respite prior to the Christmas holiday, according to this week’s Freddie Mac rate survey.

Average interest rates on both major types of fixed-rate mortgages rose by 5 basis points, while the 5-year adjustable rate mortgage was up as well. Interest rates on 30-year fixed-rate loans increased to an average 4.86 percent, up from 4.81 percent last week, while the average on 15-year fixed-rate loans was up to 4.20 percent, compared to 4.15 percent previously.
 
Initial rates on Treasury indexed adjustable rate mortgages rose to 3.77 percent, up from 3.75 percent last week.
 
The one type of loan that bucked the trend was the 1-year ARM, which posted a significant drop in rates, falling to an average 3.26 percent, down from 3.40 percent the week before.
 
All rates remain well below their marks of one year ago this week and the year ends with 2010 having the distinction of the lowest average rates in more than half a century. For the entire year, 30-year rates averaged just below 4.7 percent, a level not seen since 1955 when the average home sold for $22,000.
 
Interest rates have been rising steadily since bottoming out in early November, with the exception of a small drop last week. Since then, both fixed-rate loans have risen by well over half a percentage point.
 
The current rates return 30-year loans to levels they were last at in May, while 15-year mortgages are back to the rates they were at in June.

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