Average US 30-year mortgage rate rises to 3.54 percent

WASHINGTON (AP) – Long-term U.S. mortgage rates jumped this week, reaching their highest levels since late June amid indications of strength in the economy.

Mortgage giant Freddie Mac said Thursday the average for a 30-year fixed-rate mortgage rose to 3.54 percent from 3.47 percent last week. Rates remain near historically low levels, however. The benchmark 30-year rate is down from 3.87 percent a year ago. Its all-time low was 3.31 percent in November 2012.

The 15-year fixed-rate mortgage, popular with homeowners who are refinancing, increased to 2.84 percent from 2.78 percent.

Government data issued Monday showed that consumers boosted their spending in September at the fastest pace in three months, while their incomes grew by a modest amount. The latest positive economic news added to the momentum behind an expected interest-rate increase by the Federal Reserve next month.

Record-low interest rates this year have helped spur home purchases and boost the housing market. The Fed has been holding its key short-term rate at a record low near zero for seven years, since the onset of the financial crisis. At their meeting this week that concluded Wednesday, the Fed policymakers didn’t move on rates so close to Election Day. But the Fed hinted that it would raise rates soon, possibly next month.

To calculate average mortgage rates, Freddie Mac surveys lenders across the country at the beginning of each week. The average doesn’t include extra fees, known as points, which most borrowers must pay to get the lowest rates. One point equals 1 percent of the loan amount.

The average fee for a 30-year mortgage fell to 0.5 point from 0.6 point last week. The fee for a 15-year loan was unchanged at 0.5 point.

Rates on adjustable five-year mortgages averaged 2.87 percent, up from 2.84 percent last week. The fee held steady at 0.4 point.