30-, 15-Year Mortgage Rates Highest Since Mid-April

•Mortgage Applications Fall as Rates Rise•Mortgage Applications Down as ARM Demand Tumbles•Mortgage Applications Rise on Surging Demand•Percentage of Late Mortgage Payments Falls•Mortgage Refinancing Applications Surge •30-Year Mortgages Lowest Since April 2004 •Adjustable Mortgage Loan Applications Hit New Peak•Higher Mortgages Will Cool, Not Sink Home Market

WASHINGTON — Average U.S. interest rates on 30- and 15-year mortgages continued to climb this week, mortgage finance company Freddie Mac (FRE) said Thursday, reaching their highest levels since mid-April.

U.S. 30-year mortgage rates averaged 5.82 percent this week, up from 5.77 percent last week. It was the highest level for 30-year mortgages since they hit 5.91 percent in the April 14 week.

Fifteen-year mortgages averaged 5.38 percent, compared with 5.34 percent last week. This was the highest for 15-year mortgages since mid-April, when they reached 5.46 percent.

One-year adjustable rate mortgages (search) (ARMs) inched up to an average of 4.47 percent from 4.46 percent.

A year ago, 30-year mortgage rates averaged 5.99 percent, 15-year mortgages 5.40 percent and the ARM 4.08 percent.

Frank Nothaft, Freddie Mac vice president and chief economist, said in a statement that it is likely long-term mortgage rate costs will continue to rise in upcoming months.

The Federal Open Market Committee (search) meets on Tuesday to determine its next interest rate move. Its last meeting at the end of June marked a ninth straight increase in the federal funds rate.

Freddie Mac has also witnessed a large interest in refinancing, Nothaft said. "Just in the second quarter of 2005, approximately 74 percent of refinancing comprised of homeowners taking out a new loan balance of 5 percent or more, most of which had an interest rate below today's prime rate," he said.

Freddie Mac said lenders charged an average of 0.6 percent in fees and points on 30- and 15-year mortgages, both up from 0.5 last week. They charged 0.7 percent on the one-year ARM, unchanged from the week before.

The hybrid "5/1" ARM, set at a fixed rate for five years, then adjustable each year following, rose to 5.30 percent from 5.27 percent, Freddie Mac said.

Freddie Mac is a mortgage finance company, chartered by Congress, that buys mortgages from lenders and packages them into securities to sell to investors or to hold in its own portfolio.

What are people saying about mortgages today:

Rates on 30-year mortgages edged down last week to a seven-month low. Mortgage-giant Freddie Mac reported Thursday that 30-year, fixed-rate mortgages fell to 6.3 percent, down slightly from 6.31 percent two weeks ago. It put rates at the lowest level since they were at 6.24 percent the first week of March.

Bank of Hawaii, Central Pacific Bank, Territorial Savings Bank and Wells Fargo Home Mortgages all cut their 30-year mortgage rates to 5.75 percent this week.

Most people think of a mortgage as a means to an end. After all, you buy a house, not a home loan. But a mortgage is much more than the path to homeownership. It is a financial instrument that must be managed, just like any other financial investment.