According to Zillow, the average mortgage rates in Pennsylvania rose for the second straight week last week. The national average also edged up but stayed just below 5 percent.

Looking into details, average fixed mortgage rates in Pennsylvania on a 30-year mortgage was 5.06 percent, up from 5.03 percent the week prior. Nationally, the average 30-year fixed mortgage rate was 4.97 percent for the week ended Oct. 20, up from 4.95 percent a week earlier.

On 15-year mortgage, the fixed rate nationwide rose to 4.38 percent for the week, and the average 5-1 adjustable rate mortgage rose to 3.87 percent.

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On the Federal Reserve Bank’s side, it stated that they are going to stop buying US Treasuries by the end of October. The plan was initially to stop purchasing treasuries by the end of September but Ben Bernanke and the Fed presidents decided they would extend the program through October. When the Fed does stop buying treasuries we can only hope that foreign investors jump in and soak of some of these investment vehicles.

Read a detailed report by subprimeblogger

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99% of major borrowers whose original loan was ARM now selected a new conforming fixed-rate mortgage. 30-year fixed-rate mortgages tended to be the preferred new product, 15-year fixed-rate mortgages gained favor among refinancers, with roughly a 2 percentage point increase in the proportion choosing this product for original ARM borrowers and nearly a 4 percentage point increase among original fixed-rate borrowers.

Both refinancing borrowers and families buying homes are getting away from ARMs in the current environment. During this period, the 5/1 hybrid ARMs carried an average rate of 4.9 percent while 30-year fixed mortgage rates were only at 5.0 percent on average. The small benefit from the lower rate is not enticing enough to cover the risk that rates will rise in the future from these historic lows.

These estimates come from a sample of properties on which Freddie Mac has funded at least two successive loans and the latest loan is for refinance rather than for home purchase.

Read more about the latest mortgage loan modification trends here.

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The rates do not include add-on fees known as points. The nationwide fee averaged 0.7 of a point for 30- and 15-year fixed-rate mortgages, 0.6 of a point for five-year adjustable-rate mortgages and 0.4 of a point for one-year adjustable-rate mortgages.

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When the 10 year yield moves up, mortgage rates moving up is very normal. Knowing this, if you plan on refinancing or buying your first home, it would be very smart to speed up the process now rather than later.

If you’ve come across the advertisements over the Internet and television for mortgage rates under 5%, this is the best time to inquire, and in fact speed up your mortgage loan application process. If you wait a few months or even a few weeks, you might be staring at mortgage rates in excess of 6%, so make most of it before it’s too late.

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The index that measures new mortgage purchases rose by 1.1%, the third modest gain in the last month. Refinance activity returned to around 52% of all mortgage applications.

More borrowers turned to adjustable-rate mortgages as rates have ticked up. ARMs accounted for 5.8% of all mortgage originations last week, up from 5.4% in the previous week and from lows of 3% when mortgage rates dropped below 5% in April and May.

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Although low interest rate is your priority, but why it’s not always the only concern? It’s because your mortgage is dependent on many other factors.  So, research well before making a decision. Here goes the list that may help you making a good decision.

1. Teaser Rates:  attractively low advertised interest rates are often just a way to get you in the door. The truth about mortgage rates is that they change multiple times a day.
2. Fees: many costs associated with taking out a mortgage besides the interest rate, like closing costs. Just as the grocery store tries to get you in the door by advertising a gallon of milk for $2 but then wants to charge you $5 for the cereal to pour it on, a bank might advertise a lower interest rate than its competitors but then expect you to pay double the closing costs you might pay elsewhere.
3. Type of Loan: type of loan you qualify for will affect your interest rate. That great mortgage rate that you see advertised might be for a 15-year fixed conventional mortgage, but your income and savings might only qualify you for a 30-year fixed FHA mortgage, which will have a higher interest rate and a higher long-term cost.
4. Location: the first question any lender will ask you is the zip code where you plan to purchase property. The national average might be 5.41% on a 30-year fixed, but the average rate in New York City might be 5.49% while the average rate in San Francisco might be 5.33%. So, look into it too.
5. Credit Score: The best advertised rates only go to borrowers with the best credit scores. Your credit score, if not observed as good in the past, might cause you have higher interest rates.

So you must know that mortgage rates vary and change multiple times within a day even. Depending on your geographic location, the type of loan you want and your credit score, they further vary. A mortgage lender might advertise a great rate, but charge you double money in closing costs. So, best way will be to look at the whole loan package, not just the interest rate.

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