Mortgage rates increased for a second straight week, Freddie Mac announced Thursday. The interest rate on a 30-year fixed-rate mortgage increased slightly this week to 6.34%; however, it remains lower than the average rate over the past year.
“The 30-year fixed-rate mortgage increased again this week but remains below its 52-week average of 6.71%,” Sam Khater, Freddie Mac’s chief economist, said in a statement. “The last few months have brought lower rates and as indicated by the recently reported increase in pending home sales, homebuyers are feeling more confident to get into the market.”
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15-year rates tick up
For homeowners looking to refinance with a 15-year mortgage, it’s now a little more expensive than it was last week. This week, the average interest rate for a 15-year fixed-rate mortgage is 5.55%. Last week, the average rate was 5.49%, so it increased by 0.06 percentage points in one week. And compared to the same time last year, 15-year rates are now 0.3 percentage points higher.
Market reaction remains uncertain
The slight rise in mortgage rates could be the start of a similar pattern to what we saw last year, when rates fell ahead of a Fed rate cut and then rose again after the cut, reaching over 7%, ABC News reports.
Even if the Fed cuts rates, mortgage rates don’t always continue to decline. They can rise again depending on how markets react.
According to the Mortgage Bankers Association, mortgage applications decreased by 12.7% during the week ending Sept. 26. This indicates that fewer people applied for home loans or to refinance compared to the previous week, likely due to rising interest rates or lower demand.
