Florida Mortgage Rates Up Sharply Again

Florida mortgage rates rose for the fourth straight week, reaching their highest level since since last summer, according to a survey released by Freddie Mac.

Average mortgage rates on 30-year Florida mortgages shot up to 6.53 percent from 6.42 percent a week ago. The last time they were higher was the week of August 10, when they averaged 6.55 percent.

Fifteen-year Florida mortgage rates soared to 6.22 percent from 6.12, the highest since 6.20 percent that same week.

With such spikes, 30-year and 15-year home loans edged close to their year-ago levels. During the same week a year ago, 30-year mortgages averaged 6.62 percent and 15-years averaged 6.23 percent.

This week, one-year adjustable rate mortgages (ARM) averaged 5.65 percent up from 5.63 percent last year and from 5.57 percent a week earlier.

Florida home loan rates rose following last week’s report on May employment from the government, sparking wider inflation fears and lowering investors’ expectations for a rate cut from the Federal Reserve.

“May’s unemployment rate remained at the second-lowest level since May 2001 while average hourly earnings rose. Additionally, unit labor costs are up over the first three months of the year, tripling the original estimate, and fueling inflation fears,” said Frank Nothaft, Freddie Mac V.P. and chief economist.

A Florida mortgage lender charged an average of 0.4 points on 30- and 15-year mortgages, with 1 point usually representing 1 percent of the loan amount.

The average points have remained at that level since they were 0.4 percent in the week ending May 17. Fees on the one-year ARM averaged 0.7 percent, up slightly from 0.6 percent one week prior.

The “5/1″ ARM, set at a fixed rate for five years and then adjustable each following year after that, averaged 6.24, up from 6.19 percent last week.

Fees and points charged on the hybrid Florida mortgage loans averaged 0.6, also up from the 0.5 percent registered a week earlier.

SOURCE: Reuters