Bailout pushes mortgage rates up

USA TODAY, October, 2008 by Stephanie Armour

A recent jump in mortgage rates could jeopardize any turn-around in the housing market as home buyers face steeper loan costs.

The average interest rate on a 30-year, fixed-rate mortgage this week hit 6.46%, up from 5.94% last week, mortgage giant Freddie Mac reported Thursday.

The roughly half-point increase is the biggest weekly jump since 1987. On a $165,000 loan, a borrower would pay $1,069 monthly, or $58 more than the payment on the same loan taken out last week. Despite the big jump, the 30-year rate is about where it was as recently as mid-August.

Home sales nationally have increased as prices have declined, the National Association of Realtors (NAR) reported last week. But escalating mortgage rates are eroding some of the growing...