30-year loan rates increase to 5 percent

WASHINGTON (AP) - Rates for 30-year home loans have inched up, hitting 5 percent for the first time in nearly a month after bond yields edged up.

The average rate on a 30-year fixed mortgage was 5 percent last week, up from 4.92 percent a week earlier, mortgage company Freddie Mac said Thursday. It was the highest average since the week of Sept. 24, when rates averaged 5.04 percent.

While above the record low of 4.78 percent hit in the spring, rates are still attractive for people looking to buy a home or refinance.

To prop up the housing market and help the economy recover from the worst recession since the 1930s, the Federal Reserve has been engaged in an extraordinary level of support, spending $1.25 trillion on mortgage-backed securities, which has driven down rates on home loans.

Last month, Fed Chairman Ben Bernanke and his colleagues agreed to slow down the pace of the program to buy mortgage securities from Fannie Mae and Freddie Mac. Instead of wrapping up the purchases by the end of this year, the Fed now plans to do so by the end of March.

The average rate on a 15-year, fixed-rate mortgage rose to 4.43 percent, from 4.37 percent the previous week, according to Freddie Mac.

Rates on five-year, adjustable-rate mortgages averaged 4.4 percent, up from 4.38 percent a week earlier. Rates on one-year, adjustable-rate mortgages fell to 4.54 percent from 4.6 percent.

The rates do not include add-on fees known as points. The nationwide fee for loans in Freddie Mac's survey averaged 0.7 points for 30-year loans. The fee averaged 0.6 points for 15-year, five-year and one-year loans.