Mortgage interest rates just hit the highest level in seven years, but those in the lending trenches already knew that, right? That news shouldn’t come as a surprise to those of you who live and breath the mortgage business.
But what about everybody else?
What about borrowers who want to buy a new house this summer? Do they realize that mortgage rates haven’t been this high since May 2011? Is that sticker shock going to drive some prospective buyers to remain prospective buyers this summer?
These are the questions that are probably plaguing Loan Officers right now.
According to the latest data from Freddie Mac, the interest rate on the 30-year fixed-rate mortgage averaged 4.61% for the week that ends Thursday. Mortgage rates crossed the 4% threshold back in January and haven’t looked back since.
Overall, the 30-year FRM is up nearly 70 basis points in 2018.
Per the most recent data from the Mortgage Bankers Association, mortgage rates are even higher, checking at 4.77% over the last week. That same report also showed that mortgage applications are decreasing, perhaps an early indication that a slowdown could be coming in buyer interest.
As Freddie Mac’s new chief economist Sam Khater notes, rising interest rates aren’t the only economic pressure consumers are facing right now.
“Healthy consumer spending and higher commodity prices spooked the bond markets and led to higher mortgage rates over the past week,” Khater said this week. “Not only are buyers facing higher…