Mortgage rates keep rising. The sooner you get a loan, the better

How Fed hike affects mortgages, car loans, credit cards

Mortgage rates keep rising. The sooner you get a loan, the better

The 5-year adjustable rate mortgage (ARM) averaged 3.28%, up from 3.23% last week and 2.93% from a year ago.

It was the second consecutive week that rates increased.

Additionally, the fixed 15-year mortgage averaged 3.50%, which is eight points higher than the 3.42% previously posted.

Much of the commentary surrounding the Federal Reserve's decision Wednesday to raise the Fed Funds rate by 25 basis points has been about how this is likely to increase mortgage rates, have a negative effect on home affordability, and potentially derail the still-wobbly recovery of the United States housing market. Rates began to increase the previous week in anticipation of the Federal Reserve's announcement yesterday that it would be increasing the Fed Funds rate by another 0.25%. A year ago, it was 3.93 percent.

The mortgages in this week's survey had an average total of 0.28 discount and origination points.

Despite the rise, the 30-year fixed mortgage rates are significantly lower than they were during the last week of 2016. "Although our survey was conducted prior to the Fed's decision, the release of the February jobs report all but guaranteed a rate hike and boosted the 30-year mortgage rate 9 basis points to 4.30 percent this week".

For a full analysis of this week's move in mortgage rates, go to http://www.bankrate.com/finance/mortgages/mortgage-analysis-031517.aspx. The government-backed mortgage-backer aggregates current rates from 125 lenders from across the country weekly to come up with national average mortgage rates.

Mortgage rates still remain historically low and "rising rates are not expected to slow down demand this spring homebuying season", said First American chief economist Mark Fleming. "Tight inventory remains a much more pressing concern for home shoppers today, a situation that is unlikely to ease in the months ahead".

The average rate on a 15-year mortgage rose to 3.50% from 3.42% last week. The refinance index grew 4 percent, while the purchase index was 2 percent higher.

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