Bankrate: Mortgage Rates Climb for Second Consecutive Week

NEW YORK, Dec. 21 /PRNewswire-FirstCall/ -- Mortgage rates increased in the past week, largely due to evidence of robust retail sales. The average 30- year fixed rate mortgage is now 6.2 percent. According to Bankrate.com's weekly national survey of large lenders, the 30-year fixed rate mortgages had an average of 0.24 discount and origination points.

The average 15-year fixed rate mortgage popular for refinancing rose to 5.95 percent. On larger loans, the average jumbo 30-year fixed rate is now 6.45 percent. The average 5/1 adjustable rate mortgage climbed to 6.09 and the average one-year ARM notched higher to 5.91 percent.

Last week's strong retail sales report provided evidence that any hopes of a Fed rate cut are premature. It was also a dose of reality to bond investors that had been viewing the economic glass as half-empty and had been pushing bond yields and mortgage rates lower. Mortgage rates are closely related to the yields on long-term government bonds. Bond yields and mortgage rates have been in a holding pattern since, with the markets shrugging off data on producer prices and housing starts.

Fixed mortgage rates are sharply lower since the Fed stopped raising interest rates at mid-year. In late June, the average 30-year fixed mortgage rate was 6.93 percent. At the time, the monthly payment on a loan of $165,000 was $1,090. With the average 30-year fixed rate now 6.2 percent, the same loan originated today would carry a monthly payment of $1,010.57. Fixed mortgage rates are a compelling refinancing alternative for adjustable rate borrowers facing sharp payment adjustments.

                              SURVEY RESULTS

   30-year fixed: 6.20% -- up from 6.13% last week (avg. points: 0.27)
   15-year fixed: 5.95% -- up from 5.86% last week (avg. points: 0.25)
      5/1 ARM: 6.09% -- up from 6.02% last week (avg. points: 0.27)

Bankrate's national weekly mortgage survey is conducted each Wednesday from data provided by the top 10 banks and thrifts in the top 10 markets.

For a full analysis of this week's move in mortgage rates, go to http://www.bankrate.com/mortgagerates

The survey is complemented by Bankrate's weekly forward-looking Rate Trend Index, in which a panel of mortgage experts predicts which way the rates are headed over the next 30 to 45 days. The panelists have mixed opinions, with 43 percent expecting rates to reverse course and fall in the next several weeks. The remainder are split, with 29 percent predicting rates to rise and 28 percent forecasting that rates will remain unchanged in the coming 30 to 45 days.

For the full mortgage Rate Trend Index, go to http://www.bankrate.com/RTI About Bankrate, Inc.

Bankrate, Inc. (NASDAQ: RATE) owns and operates Bankrate.com, a leading Internet consumer banking marketplace. Bankrate.com is a destination site of personal finance channels, including banking, investing, taxes, debt management and college finance. It is the leading aggregator of more than 300 financial products, including mortgages, credit cards, new and used auto loans, money market accounts and CDs, checking and ATM fees, home equity loans and online banking fees. Bankrate.com reviews more than 4,800 financial institutions in 575 markets in 50 states. In 2005, Bankrate.com had over 46 million unique visitors. Bankrate.com provides financial applications and information to a network of more than 75 partners, including Yahoo! (NASDAQ: YHOO) , America Online (NYSE: TWX) , The Wall Street Journal (NYSE: DJ) and The New York Times (NYSE: NYT) . Bankrate.com's information is also distributed through more than 400 national and state publications. In addition to Bankrate.com, Bankrate, Inc. also owns and operates FastFind, an internet lead aggregator and MMIS/Interest.com, which publishes mortgage guides and financial rates and information.

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