Interest Rates Level Off

Interest Rates Level Off

For nearly 10 months interest rates moved up a little, then down a little, but the average cost for most types of mortgages remained below 6.5%.  Then rates unexpectedly took off in late May, making home loans more expensive than they’ve been since, well, this time last year.

A recent survey of major lenders taken July 3 found the average:

30-year fixed-rate loan — the most popular way to pay for a house — costs 6.78%.

15-year fixed-rate loan costs 6.46%.

That means payments would be $650 a month for every $100,000 borrowed with the average 30-year, fixed-rate loan. That’s just $6 a month less than you’d have paid in July 2006 but $38 a month more than in mid-March when interest rates were below 6.2%.

Interest rates have stabilized over the past couple of weeks and, if borrowers are fortunate, they’ve peaked and may drift lower over the next couple of months. That’s what happened last summer after 30-year fixed-rate loans topped out at 6.93% the last week in June.

For more on what mortgage rates are running here locally in the Greater Philadelphia area, give us a call or leave us a comment and we'll get back to you.