Mortgages rise for second week in a row

Mortgage rates mostly increased this week following a favorable jobs report and overall improvements in the global economy.

More hires equal higher mortgage rates?

The U.S. economy added 242,000 jobs last month — exceeding expectations — according to the latest employment situation summary from the Bureau of Labor Statistics.

Since the release of the jobs report, the 10-year Treasury yield has been hovering around 1.85 percent to 1.9 percent, which is up from a low of about 1.74 percent early last week. Rising oil prices also helped drive the yield higher.

Mortgage rates typically move in the same direction as long-term government bond yields.

A look at rates this week

• The benchmark 30-year fixed-rate mortgage rose to 3.87 percent from 3.82 percent, according to Bankrate’s March 9 survey of large lenders. A year ago, the rate was 3.97 percent. Four weeks ago, it was 3.78 percent. The mortgages in this week’s survey had an average total of 0.17 discount and origination points. Over the past 52 weeks, the 30-year fixed has averaged 4 percent. This week’s rate is 0.13 percentage points lower than the 52-week average.

• The benchmark 15-year fixed-rate mortgage stayed at 3.1 percent.

• The benchmark 30-year fixed-rate jumbo mortgage rose to 3.78 percent from 3.74 percent.

• The benchmark 5/1 adjustable-rate mortgage rose to 3.33 percent from 3.32 percent.

Housing market optimism on the rise

Mortgage applications ticked up 0.2 percent last week from the previous week, according to data from the latest Mortgage Bankers Association’s weekly survey.

The unadjusted purchase index rose 6 percent from the week prior and was 30 percent higher than the same week in 2015.

Consumers are more optimistic about the housing market overall, according to a new Fannie Mae report. The Home Purchase Sentiment Index increased 1.2 points to 82.7. Additionally, the segment of consumers who believe now is a good time to buy jumped by 4 percentage points. The share of those who think home prices will rise over the next year fell 4 percentage points, however.

Homebuying season has arrived

The current interest rate environment still offers current homeowners an opportunity to refinance, whether it’s to reduce their monthly mortgage payment, drop private mortgage insurance or shorten their loan term, says John Stearns, a senior mortgage banker for American Fidelity Mortgage Services in Milwaukee.

For newcomers, it’s necessary to get a preapproval before diving head first into the homebuying process.

“Find out what your credit report says, make sure there are no surprises there that can come back and cause problems down the road,” he says.Michael Becker,

Michael Becker, branch manager at Sierra Pacific Mortgage in White Marsh, Ma., agrees.

“The spring buying season is coming up; if you’re looking to buy, get preapproved,” he says, adding that the upcoming homebuying season is expected to be a competitive one due to the lack of housing supply.

“Do everything you can to make your offer stand out,” such as contributing a larger down payment in addition to having a loan preapproval, he adds.