U.S. home buyers better lock in their mortgage rates while they can.
After months at basement levels, mortgage rates are starting to rise again--a trend that may continue for months ahead.
The rate for a 30-year fixed mortgage hit 3.48 percent yesterday on Zillow's mortgage rate ticker, up from 3.39 percent a week ago. It was the second straight week of rising rates, Zillow reports.
Zillow attributed the increase to "rumors" the Federal Reserve would begin scaling back the QE3 stimulus program sooner than expected. But Zillow predicts rates are on an extended upswing.
"This coming week, we expect rates will continue a longer-term upward trend as economic data points towards continued signs of economic recovery," Erin Lantz, director of Zillow Mortgage Marketplace, said in a statement.
Zillow's rates are based on real-time quotes submitted daily to anonymous borrowers and "reflect the most recent changes in the market," the site claims.
But Zillow is not alone in forecasting a steady rise in mortgage rates.
The latest report from the Mortgage Bankers Association also shows a turnaround in rates. After months of declines, MBA shows rates bottoming out at the end of 2012 and steadily rising through 2013.
Rates for a 30-year-fixed mortgage are expected to hit 3.6 percent by the end of the second quarter and rise to 4.1 percent by the end of the year.
Rates will continue to rise in 2014, hitting 4.6 percent by the end of 2014, MBA forecasts.