US average rate on a 30-year mortgage climbs for the first time since late May to just under 7%

Los Angeles, July 3 (BNA): The US average rate on a 30-year mortgage rose this week, pushing up borrowing costs on a home loan for the first time since late May.

    

The rate rose to 6.95% from 6.86% last week, mortgage buyer Freddie Mac said Wednesday. A year ago, the rate averaged 6.81%.

 

According to the Associated Press (AP), the uptick follows a four-week pullback in the average rate, which has mostly hovered around 7% this year.

 

When rates rise, they can add hundreds of dollars a month in costs for borrowers. The elevated mortgage rates have been a major drag on home sales, which remain in a three-year slump.

 

Borrowing costs on 15-year fixed-rate mortgages, popular with homeowners refinancing their home loans, also rose this week, pushing the average rate to 6.25% from 6.16% last week. A year ago, it averaged 6.24%, Freddie Mac said.

 

Mortgage rates are influenced by several factors, including how the bond market reacts to the Federal Reserve’s interest rate policy and the moves in the 10-year Treasury yield, which lenders use as a guide to pricing home loans.

 

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