NEW YORK — Roger Wald recently discovered he would save $25,000 a year if he refinanced his five-year mortgage at 4.75 percent. Wald, an auto-body repairman in Sarasota, Fla., could have gotten that rate last month.
But like many homeowners, he waited for rates to fall further. Now, he’s worried he missed his chance.
Mortgage rates at some lenders spiked by as much as 1 percent Wednesday and saw little relief Thursday, according to mortgage brokers.
“The 4.75 percent my broker quoted two weeks ago? There’s no way I’m going to get that now,” said Wald, 49.
The fear dogging homeowners and investors alike is that April’s record lows in mortgage rates may have come and gone.
The stock market has rallied since early March on the assumption the economy will rebound this year. Federal Reserve Chairman Ben Bernanke has been calling early signs of economic stabilization “green shoots” — and one of those shoots was a pickup in refinancing activity caused by tumbling mortgage rates.
But mortgage rates have rebounded sharply over the past few days as the nation’s growing debt raises concerns that government-backed assets could lose value. It’s a trend that could slow refinancing and homebuying. Higher mortgage rates won’t necessarily derail the economy’s recovery, analysts say, but it certainly won’t help.
“If the Fed does not step in, you are going to see the ‘green shoots’ get frostbite,” said T.J. Marta, founder of financial research firm Marta on the Markets.
The average rate for a 30-year fixed-rate mortgage is 4.91 percent this week, Freddie Mac said Thursday.
