Mortgage Rates Above 5%

I'm waiting for massive government borrowing to drive up interest rates.

Mortgage rates are now well above 5%.

This should choke off the refinance market and slow already low home sales.

Easy money got us into this housing mess. I don't expect easy money will get us out.

Report:

Mortgage rates are continuing their creep upward into the 5% range — a trend that well may choke off the refi boom of late 2009 and provide a test for the real strength of the home lending market in 2010.

Freddie Mac's widely watched survey found that rates averaged 5.14% this week for 30-year fixed home loans, up from 5.05% last week and slightly higher than at the same time last year. It was the fourth straight week of increases. For 15-year fixed mortgages, the typical rate was 4.54%, up from 4.45% a week earlier.

The Freddie Mac weekly survey assumed that borrowers had good credit, a 20% down payment or 20% equity in the case of refinancing, and paid 0.7% of the loan balance in upfront charges to the lender.