Have Mortgage Rates Hit Bottom?

Home loan interest rates inched back upwards, rising from record lows across the board for the first time in eight months, according to Freddie Mac’s weekly survey.

The average interest rate for fixed-rate loans and for the five-year adjustable-rate mortgage (ARM) have risen for a third straight week, the government-sponsored mortgage agency reported. The one-year ARM also was up from its historic low hit last week.

So have mortgage rates bottomed out? And more to the point, have you missed your shot a getting a historically low rate if you haven’t already refinanced your mortgage?

“Not necessarily,” said Larry Barrick, sales manager for imortgage in Anaheim. “They have not necessarily bottomed out.”

According to the survey, average rates this week were:

* Thirty-year fixed-rate mortgage: 4.46% with 0.8 of a point (equivalent to 0.8% of the loan amount) paid at the start of the loan. That’s up for a third straight week, but still 0.75% below this year’s high in April. For someone borrowing $200,000 at this week’s rates, monthly payments are nearly $91 below the 2010 high. But the all-time low in records dating back to 1971 was 4.17%, so today’s borrower will pay $34 a month more than someone who closed a $200,000 loan a month ago.
* Fifteen-year fixed rate mortgage: 3.81% with 0.7 of a point paid up front. That’s up from the all-time low of 3.57% hit on Nov. 11 in records dating back to 1991. For someone borrowing $200,000 at this rate, monthly payments are up $24 from the record low, but down $72 from April’s high.
* Five-year ARM: 3.49% with 0.6 of a point paid up, front. That’s up from the all-time low of 3.25% set three weeks ago in records dating back to 2005.
* One-year ARM: 3.25% with 0.6 of a point paid up front. That’s up from the all-time low of 3.23% set last week in records dating back to 1984.

Interest charged for the benchmark 30-year fixed-rate loan began a six-month slide starting in June, hitting record lows 13 times before turning around last month. Mortgage rates began to fall as investors sought the security of U.S. Treasury bonds, which influence mortgage rates.

Barrick said it’s not too late for homeowners to refinance their loans, but warned that they shouldn’t wait to long to get the process started.

“Mortgage rates are quick to go up, but very slow to come back down,” he said.

Information Provided By The Orange County Register