By ReviewMyMortgage Admin

Mortgage Rates Approach 7% This Week

The average rate on a 30-year mortgage has risen this week to nearly 7%, marking the first increase since late May. This uptick is part of a broader trend of high rates affecting the housing market, with Freddie Mac reporting the current average rate at 6.95%, up from last week’s 6.86%.

Overview of Recent Mortgage Rate Changes

This week, the average rate on the traditional 30-year fixed mortgage increased, signaling a shift in the housing finance landscape. According to Freddie Mac, the rate rose to 6.95% from 6.86% last week, a jump that positions the rate just shy of the 7% mark.

Impact on Borrowing Costs

The rise in mortgage rates is contributing to higher borrowing costs, potentially adding hundreds of dollars to monthly expenses for new home loans. This increase marks the first rate rise since late May and follows a period of four weeks where rates had slightly declined.

Rates for Shorter Loan Terms

Similarly, the rate for 15-year fixed-rate mortgages, a popular choice among those refinancing their homes, has also seen an increase this week. The rate moved up to 6.25% from 6.16%, according to data from Freddie Mac.

Factors Influencing Mortgage Rates

Mortgage rates are closely tied to movements in the bond market, particularly the yields on 10-year Treasury notes, which lenders use as a benchmark for pricing loans. Despite recent declines in these yields on hopes of slowing inflation, rates have ticked upward.

Federal Reserve's Role and Future Outlook

The Federal Reserve has maintained its key interest rate with signals of a possible rate cut later this year. Such a move could influence long-term mortgage rates, potentially easing them if the anticipated cuts materialize.

The Bottom Line

While mortgage rates have climbed this week, there is potential for rates to decrease later in the year, according to experts. This could present new opportunities for buyers if the market adjusts to the changing economic indicators.

For more information on navigating these mortgage rate changes, Find Down Payment Assistance Programs Near You.

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