Smart Borrower Blog

Mortgage Rates Soar to 4-Year High

Apr 25th, 2018 @ 3:08 PM by Amber Nelson

Long-term U.S. mortgage interest rates jumped up to the highest level in four years last week, according to data from mortgage guarantor Freddie Mac, being spurred upward by optimistic economic comments by Federal Reserve Officials.

“Treasury yields rose ahead of the release of the Fed’s Beige Book and speeches from New York Fed President William Dudley and Fed Governor Randal Quarles,” said Freddie Mac deputy chief economist Len Kiefer. “According to the Beige Book PDF, economic activity in March and early April continued to expand at a moderate pace, however there is concern from various industries surrounding tariffs. Following Treasurys, mortgage rates soared.”

The average rate for the 30-year fixed-rate mortgage (FRM) leapt up to 4.47% with an average 0.5 point during the week ended April 19, 2018, up from 4.42% the week before. It is also up compared to a year ago when the average was just 3.97%. The 30-year rate is now higher than it has been since January 2014.

Rates jumped on other mortgage loans as well. The average rate on a 15-year FRM rose to a seven-year high of 3.94% with an average of 0.4 point, from 3.87% the previous week and 3.23% the year before.

The average rate on a 5-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) soared to 3.67% with an average of 0.3 point, the highest level since April 2011 and up from 3.61% the week earlier. One year ago, the average was 3.10%.

The sharp rise in rates caused a slight decline in mortgage refinance applications, according to the Mortgage Bankers Association. Refinance loan requests made up just 37.2% of all mortgage applications in the latest week, the smallest share in over nine years. Home purchase applications were unchanged from the week before, but further jumps in rates could significantly slow the pace of home buying as loans become more expensive.

About Amber Nelson
Amber Nelson is a seasoned mortgage industry writer and a regular contributor to and

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