Friday, December 22, 2006 - 30-Year Rates Still Climbing

Contra Costa Times (CA) (12/22/06); Aversa, Jeannine

After a month-long downward trend, interest on long-term mortgages moved up for the second consecutive week. Freddie Mac puts the average 30-year fixed rate at 6.13 percent this week, up a notch from 6.12 percent last week; while the 15-year fixed rate that is popular for refinancing borrowers edged up to 5.89 percent from 5.86 percent.

Initial interest on five-year adjustable-rate loans increased as well, rising to 5.96 percent from 5.92 percent, but one-year ARMs fell slightly to 5.44 percent from 5.45 percent. "This could bode well for housing in the new year," speculates Freddie Mac chief economist Frank Nothaft. "Indeed we have seen a spike in refinancing activity over the past few weeks as rates have come down.

Borrowers who have adjustable-rate mortgages that are scheduled for a rate adjustment in 2007 may want to consider refinancing those loans now."