Rates Climb

The average 30-year fixed mortgage rate rose from 6.21% to 6.37% for the seven-day period ended May 24, according to Freddie Mac's Primary Mortgage Market Survey.The average 15-year fixed mortgage rate rose from 5.92% to 6.06%, the average rate for five-year Treasury-indexed hybrid adjustable-rate mortgages climbed from 5.92% to 6.02%, and the average rate for one-year Treasury-indexed ARMs rose from 5.48% to 5.64%, Freddie Mac reported. Fees and points averaged 0.4 of a point for fixed-rate mortgages, 0.5 of a point for hybrid ARMs, and 0.6 of a point for one-year ARMs. "Stronger-than-expected consumer confidence and recent comments from members of the Federal Reserve raised some inflation concerns in the market, causing it to lower expectations of a Fed rate cut this year," said Frank Nothaft, Freddie Mac's chief economist. "This helped push mortgage rates higher this week. We expect a gradual rise in mortgage rates over the remainder of the year, with sales slipping further in the second half of the year. A gradual recovery returns toward the end of 2007, with modest increases in sales and construction during 2008." A year ago, the average 30-year and 15-year fixed rates were 6.62% and 6.23%, respectively, and the average hybrid and one-year ARM rates were 6.21% and 5.61%, Freddie Mac said. Freddie Mac can be found online at http://www.freddiemac.com.