Mortgage Rates on the Rise

During the last week, mortgage rates have risen a half-point, the highest they have been since November. This may not sound like much. But that half-point can mean a few hundred dollars per month on a homeowner’s bill.

It’s no wonder that over 5% of borrowers are now behind on their payments–and have been for two months or more. And if rates keep moving on up, ability to pay will certainly decrease at a similar steady rate.

Proof of that is evident in the number of loan applications that have crossed lenders’ desks. In fact, the application rate is now the lowest its been since early March.

Though the increase differs by state, it doesn’t look good across the country. There are even predictions that a 6% rate could be in the not-so-distant future, further destroying many white picket dreams even before they begin.

Delinquencies are especially high in Nevada, at just under 12%, followed by Florida at 11%. The lowest delinquency rate is currently in North Dakota at 1.5%.

Has the American Dream come to an end? Is the age of the apartment, the flat, and the condo upon us? After all, what good are lower prices if rates simply continue to grow?

Maybe the dream has died for some, but it’s still possible to lock in lower rates. It does take a decent credit score and some work, however–and credit scores aren’t exactly running high these days. In fact, the national average is just one point above the score needed for an FHA loan–and even with that, buyers will still be paying a heavy price.