The average rate on a 30-year mortgage in the U.S. edged closer to 7% this week as it climbed to its highest level since July.
The rate rose to 6.84% from 6.78% last week, mortgage buyer Freddie Mac said Thursday. That’s still down from a year ago, when the rate averaged 7.29%.
Borrowing costs on 15-year fixed-rate mortgages, popular with homeowners seeking to refinance their home loan to a lower rate, also ticked up this week. The average rate rose to 6.02% from 5.99% last week. A year ago, it averaged 6.67%, Freddie Mac said.
When mortgage rates increase they can add hundreds of dollars a month in costs for borrowers, reducing homebuyers’ purchasing power at a time when home prices remain near all-time highs, even though U.S. home sales are on track for their worst year since 1995.
