30-year mortgage rates rise to 4.12%

WASHINGTON -- The average rate on the 30-year fixed mortgage rose sharply this week after falling below 4 percent for the first time in history.

Freddie Mac said Thursday that the rate on the 30-year fixed loan rose to 4.12 percent. That's up from 3.94 percent last week, the lowest rate ever according to the National Bureau of Economic Research.

The average rate on the 15-year fixed mortgage, a popular refinancing option, increased to 3.37 percent from 3.26 percent, also a record.

Superlow rates haven't been enough to lift the housing market, which has struggled in recent years with anemic sales and declining home prices.

Rates have been below 5 percent for all but two weeks in the past year. Just five years ago, they were closer to 6.5 percent.

Yet sales of previously occupied homes this year are on track to be among the worst in 14 years. Sales of new homes are on pace to finish the year as the lowest on records dating back a half-century.

For many Americans, buying a house is too big a risk in this economy. Unemployment has been stuck near 9 percent for more than two years, raises are scarce and millions of foreclosures are forcing down home prices.

Others can't qualify for the historically low rates. Banks are also insisting on higher credit scores and 20 percent down payments for first-time buyers. Many repeat buyers have too little equity invested in their homes to qualify for loans.

Just half of Americans say they'll ever be able to save enough money for a down payment, according to a survey by the National Foundation for Credit Counseling.

Low mortgage rates have fueled a modest boom in refinancing. Still, most people who can afford to refinance have already locked in rates below 5 percent.