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Mortgage Rates Jump Nearly 4 Percent after Election Day
November 18, 2016

Mortgage Giant, Freddie Mac released this weeks Prime Mortgage Market Survey (PMMS) showing the average mortgage rates on a fixed rate mortgage jumped almost 4% since election day, this marks the largest spike of the year!

The surveys reveals the following:

30-year fixed-rate mortgage (FRM) averaged 3.94 percent with an average 0.5 point for the week ending November 17, 2016, showing quite a rise from last week when it averaged 3.57 percent.

15-year FRM this week averaged 3.14 percent with an average 0.5 point, showing a big jump from last week when it averaged 2.88 percent.

5/1-year ARM averaged 3.07 percent this week with an average 0.4 point and a 2.74 margin, up from last week when it averaged 2.88 percent.

The rise in the mortgage rates was fueled by a decline in U.S. bond prices after election day. Investors flooded to the stock market and pulled out of the bond markets causing Treasury yeilds to spike. These high rates can affect the housing recovery, making home buying less affordable.

This weeks increase in mortgage rates, being dubbed the Trump Tantrum, is the biggest one week increase since the Taper Tantrum in June 2013, according to Greg McBride, the senior vice president and chief financial analyst at Bankrate.com.

To calculate average mortgage rates, Freddie Mac surveys lenders across the country at the beginning of each week. The average doesn't include extra fees, known as points, which most borrowers must pay to get the lowest rates. One point equals 1 percent of the loan amount.