Despite Fed Cut, Mortgage Rates Rise

Chicago, Ill., December 13, 2007– Mortgage rose this week despite the Federal Reserve’s cut earlier in the week.

The rate for 30-year fixed mortgages averaged 6.11% this week, up from last week’s 5.96% average. The 30-year averaged 6.12% a year ago. The 15-year fixed-rate mortgage averaged 5.78%, up from last week’s 5.65%. The mortgage averaged 5.86% a year ago.

Five-year Treasury-indexed adjustable-rate mortgages averaged 5.89%, up from last week’s 5.75%. The ARM averaged 5.92% a year ago. One-year Treasury-indexed ARMs averaged 5.50%, up from last week’s 5.46% average. The ARM averaged 5.45% a year ago.

“November’s employment report showed stronger job growth, no change in the unemployment rate and a jump in wages, suggesting to some market participants that the probability of an upcoming recession might be lower than originally thought,” said Frank Nothaft, Freddie Mac chief economist, in a press release. “This led to a rise in interest rates for U.S. Treasury securities this week and mortgage rates followed.”