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LOS ANGELES – The average rate on a 30-year mortgage rose this week, pushing up borrowing costs on a home loan for the first time since late May.
The rate rose to 6.95% from 6.86% last week, mortgage buyer Freddie Mac said Wednesday. A year ago, the rate averaged 6.81%.
The uptick follows a four-week pullback in the average rate, which has mostly hovered around 7% this year.
When rates rise they can add hundreds of dollars a month in costs for borrowers. The elevated mortgage rates have been a major drag on home sales, which remain in a three-year slump.
Borrowing costs on 15-year fixed-rate mortgages, popular with homeowners refinancing their home loans, also rose this week, pushing the average rate to 6.25% from 6.16% last week. A year ago, it averaged 6.24%, Freddie Mac said.
Mortgage rates are influenced by several factors, including how the bond market reacts to the Federal Reserve’s interest rate policy and the moves in the 10-year Treasury yield, which lenders use as a guide to pricing home loans.
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