Speculation about when the Federal Reserve will begin to taper its $85-billion-per-month-bond-buying program has been impacting mortgage rates for most of 2013. The stronger economic data reported last week puts pressure on the Fed to begin tapering earlier and also pushed average mortgage rates slightly higher for the week.
Mortgage rates respond to glimmers of hope
According to HSH.com, last week the overall average rate for a 30-year fixed-rate home loan rose seven basis points (0.7 percent) to 4.34 percent. Average rates for 15-year fixed-rate mortgage loans increased by three basis points (0.03 percent) to 3.47 percent. Rates for FHA-insured, 30-year fixed-rate home loans rose six basis points (0.06 percent) to an average rate of 3.97 percent. The average rate for a 5/1 Hybrid Adjustable Rate Mortgage (ARM), moved the least last week, increasing by just two basis points (0.02 percent) to an average rate of 3.04 percent. Compare mortgage rates for your area before refinancing or applying for a purchase loan.
Encouraging economic news
Highlights among last week's economic reports include a stronger than expected job growth of 204,000 in October, along with an extra 60,000 hires to be added to the August and September job reports. In addition, the Institute for Supply Management moved up and the estimate of GDP for the third quarter looks better than expected at 2.8 percent. The Index of Leading Economic Indicators rose in both August and September, which means that the economy may finally be steadying; however, consumer confidence and spending remain low.
The mortgage experts at HSH.com anticipate that mortgage rates will rise this week by 8 to 10 basis points following on last week's positive economic reports.
Our live database of current mortgage rates can help you find the best mortgage rates in your area.