Mortgage Trends This Week: Sept. 20

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Mortgage rates continued their upward trend last week, with rates on 30-year fixed-rate mortgages on the rise this week.

In general, rates have risen steadily in September, with the 30-year fixed-rate at 4.576%, according to the BankingMyWay Weekly Mortgage Rate Tracker. Back on Aug. 30, the same index pegged the 30-year rate at 4.445%.

The rate increase follows a spate of generally good news on the U.S. economy in recent weeks. That trend is already continuing this week, with a research report from Barclays Capital that shows third-quarter U.S. gross domestic product will be higher than the second quarter of 2010.

A cynic might say with at a 1.6% growth rate in quarter two, the GDP has no room to go but up. But healthier business inventories, a more favorable trade deficit and stronger manufacturing growth will make sure the U.S. grows instead of weakens in the third quarter, and that’s going to impact mortgage rates.

For starters, a bigger GDP would put to rest talk of any double-dip recession. Economic trajectories may be based on pure scientific data, but there’s little question that the human element — especially consumer confidence — factors into the equation, too.

Lately, that sentiment has been showing signs of growing stronger — or at least consumer sentiment isn’t all negative these days, as it was for much of this spring. The new Fannie Mae (Stock Quote: FNM) National Housing Survey bears that out.

A wide majority (78%) of survey respondents told Fannie Mae researchers that home prices will either rise or remain flat over the next year — a five-point rise from January. Also, 70% of respondents said it’s a good time to buy a house, and that’s up six points from the beginning of the year. The bad news is that 83% of respondents say it’s a bad time to sell a house.

“Our survey shows that consumers see a mixed outlook for housing and homeownership,” says Doug Duncan, vice president and chief economist at Fannie Mae. “These findings indicate a return to a more balanced and realistic approach toward housing. While this will likely weigh on the housing recovery in the near-term, it should, over time, help to build a stronger and healthier market focused on sustainable homeownership.”

But the fact that we’re even talking about a stronger economy will help push mortgage rates up, as we have seen during the past few weeks.

Now, on to the numbers, measured, as always, by the BankingMyWay Weekly Mortgage Rate Tracker.

Description                       This Week                  Last Week

One-Year ARM                       3.356%                        3.458%

Three-Year ARM                     3.901%                        3.706%

Five-Year ARM                        3.583%                        3.691%

15-Year Mortgage                  4.015%                        4.023%

30-Year Mortgage                  4.576%                        4.554%

With rates up for the second week in a row, it may be the time to lock in that lower mortgage rate. For the best deals on the market, leverage the power of BankingMyWay’s Mortgage Rate Search. Week to- week, it’s your best bet for finding the best mortgage rate deal possible.

—For the best rates on loans, bank accounts and credit cards, enter your ZIP code at BankingMyWay.com.

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