BANKING & FINANCE - Oct. 8, 1994

Mortgage Rates Hit 2 1/2-Year High: Thirty-year, fixed-rate mortgages averaged 8.89% this week, according to a national survey released by the Federal Home Loan Mortgage Corp. The average was the highest since April 3, 1992, when it was 8.96%. Rates averaged 8.82% last week. The average reached a 25-year low of 6.74% a year ago. On one-year, adjustable-rate mortgages, lenders were asking an average initial rate of 5.72%, up from 5.67% last week and the highest since 5.78% in the week ended June 26, 1992. Fifteen-year mortgages , a popular option for people refinancing mortgages, averaged 8.38% this week, up from 8.31% a week earlier. The rates do not include add-on fees known as points.