(Logo:
http://www.newscom.com/cgi-bin/prnh/20040122/FLTHLOGO
) The 15-year fixed rate mortgage popular for refinancing rebounded above
the 5 percent barrier, rising from 4.99 percent to 5.02 percent. The jumbo 30-
year fixed rate mortgage climbed 2 basis points to 5.95 percent, and the one-
year adjustable rate mortgage fell 3 basis points to 3.65 percent. A basis point
is one one-hundredth of one percentage point.
Speculation about the timing
of future interest rate hikes leading up to the FOMC meeting Jan. 27-28 caused
mortgage rates to eke out a small increase. Speculation continued following the
Jan. 28 Fed announcement, which no longer contained the highly scrutinized "for
a considerable period" phrase. The prospect of interest rate hikes makes bond
investors nervous, with money often flowing out of the longest-term bonds. Mortgage
rates are closely related to the yields on long-term government bonds. The change
in the Fed's wording was enough to spook the bond investors. In the minutes following
the Fed announcement, the yield on the 10-year Treasury note spiked upward from
about 4.06 percent to about 4.18 percent.
Monthly mortgage payments remain
enticing to home buyers and refinancers alike. The monthly payment on a $165,000
loan with the average 30-year fixed rate mortgage at 5.72 percent is $959.75.
Six months ago when the average rate was 6.26 percent, the same size loan carried
a monthly payment of $1,017.01. The $57.26 difference in monthly payments amounts
to more than $20,000 over the loan term. SURVEY RESULTS 30-year fixed: 5.72% --
up from 5.67% last week (avg. points: 0.34) 15-year fixed: 5.02% -- up from 4.99%
last week (avg. points: 0.4) 1-year ARM: 3.65% -- down from 3.68% last week (avg.
points: 0.28)
Bankrate's national weekly mortgage survey is conducted each
Wednesday from data provided by the top 10 banks and thrifts in the top 10 markets.
The survey is complemented by Bankrate's weekly forward-looking Rate Trend
Index, in which a panel of mortgage experts predicts which way the rates are headed.
This week, the panel has reversed course. Where last week it was tilting toward
rates heading even lower in the next 30 to 45 days, now four out of five predict
that rates will stay the same or rise, which would argue for home buyers on the
fence to lock now. Only one-fifth believe rates will fall.
For a full analysis
of this week's move in mortgage rates, go to http://www.bankrate.com/mortgagerates
For the full mortgage Rate Trend Index, go to http://www.bankrate.com/RTI
About Bankrate, Inc.
Bankrate, Inc. (Nasdaq: RATE
- News ) owns and operates
Bankrate.com, the Internet's leading consumer banking marketplace. Bankrate.com
averages 4 million unique visitors per month, according to comScore Media Metrix,
which ranks Bankrate.com first in unique visitors in the "Financial Information
and Advice" category. Bankrate.com reviews more than 4,800 financial institutions
in more than 300 markets in 50 states. Bankrate.com is a destination site of personal
finance channels, including banking, investing, taxes and small business finance.
It is the leading aggregator of more than 250 financial products, including mortgages,
credit cards, new and used auto loans, money market accounts and CDs, checking
and ATM fees, home equity loans and online banking fees. Bankrate.com provides
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including Yahoo! (Nasdaq: YHOO
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(NYSE: AOL - News
), The Wall Street Journal (NYSE: DJ
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Times (NYSE: NYT - News
). Bankrate.com's information is also distributed through more than 100 national
and state publications. The Company's stock is included in the Russell 3000 Index
and the Russell 2000 Index.
