Interest Rates on Mortgages Trending Slightly Upward

National data shows interest rates on mortgages slightly increased, 0.02 percent from March to April, according to an index of new mortgage contracts. According to the Federal Housing Finance Agency (FHFA), the National Average Contract Mortgage Rate for the Purchase of Previously Occupied Homes by Combined Lenders index was 4.24 percent for loans closed in late April. The index is calculated using FHFA's Monthly Interest Rate Survey. The contract rate on the composite of all mortgage loans was 4.23 percent, a slight increase from 4.22 percent in March. Interest rates are typically locked in 30-45 days before a loan is closed. Consequently, April data reflects market rates from mid- to late-March. The effective interest rate was 4.38 percent, up one basis point from 4.37 percent in March. The effective interest rate accounts for the addition of initial fees and charges over the life of the mortgage. FHFA's interest rate survey shows the average interest rate on conventional, 30-year, fixed-rate mortgages of $417,000 or less was 4.53 in April, an increase of two basis points. The average loan amount for all loans was $283,800 in April up $5,300 from $278,500 in March.