Mortgage Rates Rise to 7-Week High

The average rate on 30-year fixed-rate mortgages increased to 7.12% from 6.99% last week, the highest rate in seven weeks, Freddie Mac said. It was the largest weekly rise in nine months. Just two weeks ago, the rate hit a four-year low of 6.89%. Increases since then have been attributed to financial markets’ skittishness over rising wages and uncertainty about President Clinton’s political strength since the onset of the Monica Lewinsky controversy. Mortgage rates had been declining since April 1997, when the 30-year average hit 8.18% after the Federal Reserve Board tightened monetary policy. Fifteen-year mortgages averaged 6.70% this week, up from 6.56% last week. On one-year adjustable-rate mortgages, lenders were asking an average initial rate of 5.59%, up from 5.53% and the highest since early September. The rates do not include points.