Could Rising Mortgage Rates Derail the Housing Recovery

could-rising-mortgage-rates-derail-the-housing-recoveryIn the latest survey on mortgage rates, Freddie Mac has reported rates are up across the board, driven by higher the rise in long term bond yields. Average rates for 30 year fixed-rate mortgages with an average 0.7 point, are at 5.29 percent for the week ending June 4, 2009 up from 4.91 percent. 

15 year fixed-rate mortgages averaged 4.79 percent this week with an average 0.7 point, up from last weeks average rate of 4.53 percent. Five-year Treasury-indexed hybrid adjustable-rate mortgages averaged 4.85 percent this week, with an average 0.6 point, up from last week when it averaged 4.82 percent. One-year Treasury-indexed ARMs averaged 4.81 percent this week with an average 0.6 point, up from last week when it averaged 4.69 percent.

Mortgage rates are the highest point since late last year but they are still low by historical standards. Rates would have to increase a lot more before derailing the housing market. The biggest drags on housing right now is the number of homes for sale and the rising unemployment rate.

Loan Term
Lender
APR / Rate
Fees / Points
Payment
PenFed Credit Union
NMLS #401822
4.924%
15-Year Fixed
4.625%
$8,000
Includes 1.000 points for $4,000
Lender Fees: $4,000
$3,086 /mo
District Lending
NMLS #1835285
5.459%
15-Year Fixed
5.250%
$5,500
Includes 0.875 points for $3,500
Lender Fees: $2,000
$3,216 /mo
Surety Home Loans
NMLS #1981224
5.516%
15-Year Fixed
5.250%
$7,000
Includes 0.750 points for $3,000
Lender Fees: $4,000
$3,216 /mo
GenNext.Mortgage
NMLS #2326098
License: 60DBO-181478
5.807%
15-Year Fixed
5.625%
$4,905
Includes 0.738 points for $2,952
Lender Fees: $1,953
$3,295 /mo
Solidify Mortgage Advisors
NMLS #1283930
License: 01970483
5.925%
15-Year Fixed
5.750%
$4,541
Includes 0.854 points for $3,416
Lender Fees: $1,125
$3,322 /mo
Watermark Capital
NMLS #1838
5.937%
15-Year Fixed
5.750%
$4,847
Includes 0.837 points for $3,348
Lender Fees: $1,499
$3,322 /mo
Mutual of Omaha Mortgage, Inc.
NMLS #1025894
6.040%
15-Year Fixed
5.875%
$4,256
Includes 0.889 points for $3,556
Lender Fees: $700
$3,349 /mo
District Lending
NMLS #1835285
6.344%
30-Year Fixed
6.250%
$4,000
Includes 0.500 points for $2,000
Lender Fees: $2,000
$2,463 /mo
Surety Home Loans
NMLS #1981224
6.380%
30-Year Fixed
6.250%
$5,500
Includes 0.375 points for $1,500
Lender Fees: $4,000
$2,463 /mo
Rocket Mortgage
NMLS #3030
6.407%
15-Year Fixed
6.250%
$4,000
Includes 1.000 points for $4,000
Lender Fees: $0
$3,430 /mo
PenFed Credit Union
NMLS #401822
6.692%
30-Year Fixed
6.500%
$8,000
Includes 1.000 points for $4,000
Lender Fees: $4,000
$2,529 /mo
Solidify Mortgage Advisors
NMLS #1283930
License: 01970483
6.737%
30-Year Fixed
6.625%
$4,625
Includes 0.875 points for $3,500
Lender Fees: $1,125
$2,562 /mo
GenNext.Mortgage
NMLS #2326098
License: 60DBO-181478
6.743%
30-Year Fixed
6.625%
$5,069
Includes 0.779 points for $3,116
Lender Fees: $1,953
$2,562 /mo
Watermark Capital
NMLS #1838
6.745%
30-Year Fixed
6.625%
$4,971
Includes 0.868 points for $3,472
Lender Fees: $1,499
$2,562 /mo
Surety Home Loans
NMLS #1981224
6.918%
5-Year ARM
6.750%
$6,984
Includes 0.976 points for $3,904
Lender Fees: $3,080
$2,595 /mo
Mutual of Omaha Mortgage, Inc.
NMLS #1025894
6.963%
30-Year Fixed
6.875%
$3,580
Includes 0.720 points for $2,880
Lender Fees: $700
$2,628 /mo
District Lending
NMLS #1835285
7.020%
5-Year ARM
6.875%
$5,900
Includes 0.975 points for $3,900
Lender Fees: $2,000
$2,628 /mo
Rocket Mortgage
NMLS #3030
7.225%
30-Year Fixed
7.125%
$4,000
Includes 1.000 points for $4,000
Lender Fees: $0
$2,695 /mo
Rate data provided by RateUpdate.com. Displayed by ICB, a division of Mortgage Research Center, NMLS #1907, Equal Housing Opportunity. Payments do not include taxes and insurance premiums. Actual payments will be greater with taxes and insurance included. Rate and product details.

The rise in mortgage rates has put a dent in the recent mortgage refinancing boom. Although another contribution factor for the drop-off in refinancing is the fact that almost everyone who has enough equity in their home and has good credit has probably already refinanced their mortgage.

 
Author: Brian McKay
June 4th, 2009

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