Average US rate on 30-year mortgage jumps to 3.98 per cent; 15-year loan up to 3.20 per cent

WASHINGTON – Average long-term U.S. mortgage rates this week rose sharply for a second straight week as expectations grew that the Federal Reserve may soon raise its key short-term interest rate.

Mortgage giant Freddie Mac says the average rate on a 30-year fixed-rate mortgage jumped to 3.98 per cent from 3.87 per cent a week earlier. Nearing 4 per cent, it was the highest level for the 30-year rate since July. The rate on 15-year fixed-rate mortgages climbed to 3.20 per cent from 3.09 per cent.

A year ago, the average 30-year mortgage rate was 4.01 per cent, while the rate for 15-year loans was 3.20 per cent.

While it kept the key rate at a record low near zero, the Fed recently signalled the possibility a rate hike could come at its next meeting in December.