The mortgage rate skyrockets closer to 5% in its second colossal jump

Key takeaways: 

• According to Mortgage News Daily, the average rate on the 30-year limited mortgage hit significantly higher Friday, climbing 24 basis points to 4.95%.
• The quicker-than-expected climb in rates has weighed on the need for mortgages and refinancing loans.
• With both rates and costs much higher, the median mortgage payment is almost 20% higher than a year ago.

The rate for the most typical kind of mortgage just soared again.

According to Mortgage News Daily, the average rate on the 30-year limited mortgage hit significantly higher Friday, climbing 24 basis points to 4.95%. It is now 164 basis points higher than it was one year back.

“That’s the second time this week, and it sets this week on par with the most destructive week from the 2013 taper tantrum — a record we didn’t see being legitimately questioned a few days ago,” said Matthew Graham COO of Mortgage News Daily.

On Tuesday, the rate had shot 4.72%, a 26-basis-point leap from March 18. The quicker-than-expected peak in rates has weighed on the need for mortgages and refinancing loans.

The rate soared as the work on the U.S. 10-year Treasury also took off. Mortgage rates follow that yield loosely, but not completely. Mortgage rates are also affected by the demand for mortgage-backed bonds. The Federal Reserve is climbing back its holdings of these investments and rising interest rates.

It couldn’t come at a worse time, as the all-important jump housing market gets underway. Potential customers are already facing extremely tight supply and sky-high costs. With both rates and prices much higher, the median mortgage payment is almost 20% higher than a year ago.