Adjustable rate mortgage climbs again

Thursday May 25 by Claudia bourneusatoday
The average interest rate on a one-year adjustable rate mortgage rose this week to the highest level in more than nine years, Freddie Mac says. But the 30-year home mortgage rate fell slightly. The average rate on a one-year adjustable mortgage rose to 7.25% this week from 7.15% the previous week and is the highest since 7.36% in the week ending April 26, 1991. The rise in the adjustable rate ''could lead to a slowdown in housing as home buyers who find the lower-rate ARM more appealing are priced out of the market,'' said Frank Nothaft, Freddie Mac's deputy chief economist.

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