US Rate on 30-Year Mortgage Rises to 3.55 Percent
WASHINGTON (AP) - The average U.S. rate on the 30-year fixed mortgage rose this week after falling to new record lows in each of the past 13 weeks.
Mortgage buyer Freddie Mac said Thursday that the rate on the 30-year loan jumped to 3.55 percent. That’s up from 3.49 percent last week, which was the lowest since long-term mortgages began in the 1950s.
The average rate on the 15-year fixed mortgage, a popular refinancing option, increased to 2.83 percent. That’s above last week’s record low of 2.80 percent.
Cheaper mortgage rates have helped drive a modest but uneven housing recovery this year. Sales of new and previously occupied homes fell in June from May but were higher than the same month last year. Home prices have started to rise in a majority of cities.
Builders are also more confident after seeing more demand for homes. In June, they increased their spending for a third straight month.
Low mortgage rates could also provide some help to the economy if more people refinance. When people refinance at lower rates, they pay less interest on their loans and have more money to spend. Many homeowners use the savings on renovations, furniture, appliances and other improvements, which help drive growth.
Still, the pace of home sales remains well below healthy levels. Many people are still having difficulty qualifying for home loans or can’t afford larger down payments required by banks.
The sluggish job market could deter some from making a purchase this year. The Labor Department reports Friday on July unemployment and job growth.