Mortgage rates return to highest level in more than 2 yearsStaff Writer | January 26, 2017
Mortgage rates reversed course, unwinding the decreases seen over the previous three weeks and returning to the levels seen in late December that are the highest since September 2014.
Buying house The 5-year ARM escalated to 3.51 percent
The larger jumbo 30-year fixed jumped to 4.31 percent, and the average 15-year fixed mortgage rate climbed to 3.51 percent.
Adjustable mortgage rates were up noticeably as well, with the 5-year ARM escalating to 3.51 percent and the 7-year ARM ascending to 3.75 percent.
Bond yields and mortgage rates resumed their climb over the past week following comments from Fed Chair Janet Yellen about the prospect of rising interest rates over the next couple years that also reinforced the glass-half-full optimism that investors have about the new Trump administration.
Mortgage rates are closely related to yields on long-term government bonds. The likelihood of reduced regulation, and the possibility of tax cuts and additional fiscal stimulus through infrastructure spending, have buoyed hopes for faster economic growth and boosted the odds of higher inflation in the coming years.
Either, or both, would certainly be consistent with the Federal Reserve continuing to boost interest rates.
At the current average 30-year fixed mortgage rate of 4.32 percent, the monthly payment for a $200,000 loan is $992.09. ■