30-Year Rates Experienced Large Growth This Week
Apply for a Loan
Secured with SHA-256 Encryption
UPDATED: Feb 8, 2021
Advertiser Disclosure: We strive to help you make confident loan decisions. Comparison shopping should be easy. We are not affiliated with any one loan provider and cannot guarantee quotes from any single provider. Our partnerships don’t influence our content. Our opinions are our own. To compare quotes from many different companies please enter your ZIP code on this page to use the free quote tool. The more quotes you compare, the more chances to save.
Editorial Guidelines: We are a free online resource for anyone interested in learning more about loans. Our goal is to be an objective, third-party resource for everything loan related. We update our site regularly, and all content is reviewed by experts.
Home loan interest rates jumped significantly this week according to rate reports provided by loans.org.
The 30-year rate alone increased nearly 0.2 percentage points. For the week ending May 16, 2013, the 30-year fixed-rate mortgage (FRM) averaged 3.52 percent, a significant increase from last week’s rates of 3.33 percent.
If a borrower took out a $300,000 home loan at today’s average rates, his or her monthly payment would be $1,350.49. After 30 years, he or she would pay a total of $486,176.40.
According to Freddie Mac, at this time last year, the 30-year FRM averaged 3.79 percent. Using this rate, if borrowers took an equivalent loan out a year ago, they would pay $1,396.16 monthly, for a total cost of $502,617.60 after 30 years. The savings on a $300,000 home loan today versus an identical mortgage one year ago equates to $16,441.20.
The other two rates experienced growth this week although at a slower pace. Loans.org reports that the 15-year fixed-rate mortgage averaged 2.64 percent. The rate is up 0.1 percentage points from last week’s 2.54 percent average.
The 5/1 adjustable-rate mortgage (ARM) averaged 2.31 percent. This home loan interest rate increased from 2.26 percent set last week.
The reasons for the sudden increase in home loan interest rates across the board are two-fold.
First, the United States Treasury bond yielded higher this week due to stronger consumer spending. This helped to stimulate home loan interest rates.
Secondly, households are reducing their household debt. According to the Federal Reserve Bank of New York, total household debt fell by about $110 billion during the first fiscal quarter of 2013. Although there are still about 3 million homeowners classified as seriously delinquent on their mortgages, the prevalence has reduced significantly from 5.1 million seen during the fourth quarter of 2009.