Mortgage rates have jumped above the 3% mark this week, with the average rate on a 30-year mortgage hitting 3.1% of the annual percentage rate (APR), according to the latest Primary Mortgage Market Survey by Freddie Mac.
“The combination of rising inflation and consumer spending is pushing up mortgage rates,” said Sam Khater, chief economist at Freddie Mac. “Homebuyers looking to buy a home are fueling strong demand while ongoing inventory shortages do not improve with higher home prices. This reality illustrates the difficult situation facing the housing market. “
If you are looking to save on your monthly mortgage payments, you can take out mortgage refinancing while rates remain at historically low levels. Visit Credible to find the best mortgage rate for you and see how much you could save.
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Interest rates should continue to rise
The average 30-year fixed-rate mortgage went from 2.98% last week at 3.1% for the week ending November 18. This is also an increase from 2.72% in the same period last year. The 15-year mortgage also rose to 2.39%, an increase from 2.27% last week and 2.28% last year. The five-year Treasury-indexed variable-rate hybrid mortgage edged down to 2.49%, from 2.53% last week and 2.85% last year.
And now economists predict that rates will continue to rise slowly as the Federal Reserve continues to unravel its economic stimulus.
“Freddie Mac’s fixed rate on a 30-year loan rose this week, jumping 12 basis points to 3.10%,” said George Ratiu, director of economic research at Realtor.com. “Reflected in the rebound in the 10-year Treasury yield, investors also pushed up mortgage rates following the week’s string of positive indicators, including strong retail sales, growing homebuilder confidence and an increase in industrial production.
“With positive economic indicators complementing the Federal Reserve’s pullback in mortgage-backed securities purchases, I expect rates to follow a bumpy upward path,” Ratiu said.
Homeowners can get a lower mortgage rate through refinancing and should compare several lenders for the best rate. Visit Credible to find current mortgage rates from multiple lenders in minutes.
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How to make sure you get the lowest interest rate
Despite the expected hike, current mortgage rates are still historically low. But there are still several things homeowners can do to get a low interest loan. Here are just a few:
Buy a lower mortgage rate
Average rates are low, but homeowners interested in refinancing can purchase even lower rates, known as reduction points.
“A mortgage rate buyout is when a borrower pays additional fees in exchange for a lower interest rate on their mortgage”, Rocket Mortgage Explain. “Just as lenders can help cover the borrower’s closing costs by charging a slightly higher interest rate, the door tilts back and forth. Borrowers can basically buy a lower interest rate up front. “
Compare several lenders
After getting an interest rate quote from a mortgage lender, borrowers should shop around with other lenders to see which one has the best rates. Shopping from multiple lenders can help borrowers save thousands of dollars over the life of the loan. Visit Credible to compare multiple mortgage lenders at once and choose the best mortgage lender for you.
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Work on your credit score
Borrowers with a higher credit score will receive better interest rates for their mortgages. Those considering mortgage refinancing should start improving their credit profile by paying off their credit card balances, checking their credit report errors, and paying off their debts on time.
If you want to lower your monthly mortgage payments, consider refinancing your loan at a lower rate. Contact Credible to speak to a mortgage expert and get all of your questions answered.
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