TD raises mortgage rates for third time in a month

Few borrowers fixed their loans when fixed rates were at their cheapest

This 3-bedroom home at 85-124 Plantation Road in Waianae was listed for sale at $238,000 and was in escrow.

Mortgage giant Freddie Mac says the average rate on a 30-year fixed rate loan rose this week to 4.16 per cent from 4.13 per cent the previous week.

Home borrowing costs have climbed with a surge in USA 10-year Treasury bond yields, which this week hit their highest since September 2014 in the wake of Donald Trump's US presidential win.

The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($417,000 or less) increased to its highest level since October 2014, 4.28 percent, from 4.27 percent, with points decreasing to 0.36 from 0.37 (including the origination fee) for 80 percent loan-to-value ratio loans. Anticipated tax cuts and increased government spending to upgrade roads, bridges and airports could stoke inflation.

Long-term mortgage and interest rates have surged in the weeks since Trump's surprise victory in November.

The average 15-year mortgage rate dipped to 3.52 percent from 3.53 percent, while the average five-year adjustable rate fell to 3.28 percent from 3.39 percent.

Lately, Canadian banks have had to re-think their mortgage rates because of moves in bond markets as well as policy changes in Ottawa.

"If rates continue their upward trend, expect mortgage activity to be significantly subdued in 2017", Becketti said in a statement.

The yield on the 10-year Treasury bond touched its highest level in more than two years and sat at 2.57 percent late Wednesday, up sharply from 2.34 percent a week earlier.

The Washington-based industry group said its measure of requests for mortgages fell 4.0 percent in the week to December 9 to 397.5, its lowest since 328.6 in the week ended January 1.

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