(Bloomberg) — Mortgage rates in the U.S. dipped for the first time in a month.
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The average for a 30-year loan was 3.55%, down from 3.56% the prior week, Freddie Mac said in a statement Thursday.
The dip may reassure homeowners there’s still opportunity to save money by refinancing. Still, borrowing costs are expected to increase in the coming weeks in anticipation of the Federal Reserve hiking interest rates to tame surging inflation.
“We do expect rates to continue to increase but at a more gradual pace,” Sam Khater, Freddie Mac chief economist, said in the statement. “A fair number of current homeowners could continue to benefit from refinancing to lower their mortgage payment.”
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Record-low borrowing costs have fueled a housing boom during the pandemic. Now, as inflation picks up, a gradual increase in mortgage rates is a sign of a normalizing U.S. economy, according to Melissa Cohn, a banker and regional vice president at William Raveis Mortgage.
“We’d all be better off with 2% to 3% inflation and slightly higher mortgage rates,” Cohn said. “Inflation impacts every single thing we do and every thing we buy. It’d be better if just that one, your mortgage payment, were slightly higher.”
(Updates with broker quote starting in second to last paragraph.)
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