Mortgage rates move closer to 5% as Fed quits bond-buying spree

Read more: Fed lays out plan to prune balance sheet by $1.1 billion

“Mortgage rates have increased 1.5 percentage points over the last three months alone, the fastest three-month rise since May of 1994,” Freddie Mac chief economist Sam Khater said. “The increase in mortgage rates has softened purchase activity such that the monthly payment for those looking to buy a home has risen by at least 20% from a year ago.”

The 15-year fixed-rate mortgage posted an eight-basis-point week-over-week increase, up to 3.91%. Last year, the 15-year FRM was 2.42%.

The five-year Treasury-indexed hybrid adjustable-rate mortgage rose from 3.50% the previous week to 3.56%. A year ago, the five-year ARM averaged 2.92%.