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Bankrate says mortgage rates increased for third consecutive week - Update

Thu. October 02, 2008; Posted: 10:28 AM
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(RTTNews) - Thursday, Bankrate, Inc. (RATE | Quote | Chart | News | PowerRating), operator of an Internet-based consumer banking and personal finance network, said mortgage rates increased for the third consecutive week, with the average 30-year fixed mortgage rate rising to 6.41% from last week's 6.32%. The average 15-year fixed rate mortgage popular for refinancing notched higher to 6.14% from 6.11%, while the average jumbo 30-year fixed rate climbed to 7.65%. Adjustable mortgage rates were mixed, with the average 1-year adjustable-rate mortgage, or ARM, sharply lower at 6.04%, while the average 5/1 ARM jumped to 6.49% from 6.38% last week.

According to Bankrate.com's weekly national survey, the average 30-year fixed mortgage has an average of 0.42 discount and origination points. Bankrate's national weekly mortgage survey is conducted each Wednesday from information provided by the top 10 banks and thrifts in the top 10 markets.

According to the North Palm Beach, Florida-based company, mortgage rates moved higher this week despite benchmark Treasury yields being largely unchanged, compared to one week ago. Mortgage rates are linked to bond yields.

Bankrate said the tightening grip of the credit crunch means a return to wider mortgage spreads, representing the difference between mortgage rates and the risk-free ten-year Treasury.

Though this risk premium had narrowed following the government takeover of Fannie Mae and Freddie Mac, spreads expanded following the defeat of the financial rescue package.

This year has been a wild ride for mortgage rates, with a low in January of 5.57% and a high of 6.77% in July. At the latest rate of 6.41%, a $200,000 loan carries a monthly payment of $1,252.32.

The survey is complemented by Bankrate's weekly forward-looking Rate Trend Index, where a panel of mortgage experts predicts which way the rates are headed over the next 30-45 days. Two-thirds or 67% of respondents expect rates to retreat in the coming weeks, while 13% predict a further increase in mortgage rates. The remaining 20% forecast that mortgage rates will remain more or less unchanged during the period.

RATE is currently trading at $37.03, down $0.98 or 2.58%, on 19,095 shares. For the past year, the stock trended in the range of $24.54-$57.32.

For comments and feedback: contact editorial@rttnews.com Copyright(c) 2008 RealTimeTraders.com, Inc. All Rights Reserved

For full details on Bankrate Inc (RATE) click here. Bankrate Inc (RATE) has Short Term PowerRatings of 6. Details on Bankrate Inc (RATE) Short Term PowerRatings is available at This Link.

    


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