Fixed Mortgages Hit Eight-Month High

Fixed mortgage rates surged to an eight-month high this week, according to Freddie Mac's(FRE Quote) weekly survey.

Rates climbed as Federal Reserve officials voiced concern about inflation, indicating that the agency may boost its interest-rate target. Still, most rates are far below year-ago levels.

The rate for 30-year fixed mortgages averaged 6.32% for the week ended Thursday, with an average upfront payment of seven-tenths of a point. That's up sharply from the average 6.09% a week earlier, but far below the average 6.74% rate a year ago.

Freddie said 15-year fixed mortgage rates averaged 5.93% with an average upfront payment of six-tenths of a point. Those rates are also much higher than the average 5.65% a week earlier, and slightly below the year-ago level of 5.99%.

Adjustable-rate mortgage rates also rose, with five-year Treasury-indexed hybrid ARMs averaging 5.7% with an average upfront payment of seven-tenths of a point. Those rates averaged 5.51% a week ago and 6.37% a year ago.

One-year ARMs averaged 5.09% with an average six-tenths of a point, up from 5.06% a week earlier. A year ago, those rates averaged 5.75%.

"Mortgage rates jumped this week after a number of Federal Reserve (Fed) officials, most notably Chairman Bernanke and Vice Chair Kohn, expressed concern over a threat of inflation," said Frank Nothaft, Freddie vice president and chief economist. "This led some market participants to believe that the Fed will raise rates more aggressively over the year than previously thought."

Sites like BankingMyWay.com offer a tool for visitors to check the best rates offered in their area by entering a zip code.