Mortgage rates climbed toward 7% after America’s credit rating was downgraded
Mortgage rates in the US increased this week, approaching 7%. The action follows the Federal Reserve’s rate increase from last week and Fitch Ratings’ downgrading of Freddie Mac and Fannie Mae as well as US sovereign debt this week. According to information from Freddie Mac issued on Thursday, the 30-year fixed-rate mortgage averaged 6.90% in the week ending on August 3, up from 6.81% the previous week. The 30-year fixed rate was 4.99% a year ago, the lowest it had been in the previous 12 months. The combination of positive economic data According to Sam Khater, chief economist at Freddie Mac, “the combination of positive economic data and the U.S. government credit rating downgrade caused mortgage rates to rise this week.” High-interest rates can increase monthly expenses for borrowers by hundreds of dollars, which limits how much they can purchase in a market that is already too expensive for many Americans. Since March 2022, the Federal Reserve has raised its benchmark interest rat...