The average 15-year fixed rate mortgage popular for refinancing increased to 6.12 percent, the highest point since June 2002. The average jumbo 30-year fixed rate jumped from 6.56 percent to 6.64 percent. Adjustable rate mortgages are also on the rise, with the average 5/1 adjustable rate mortgage rising from 6.04 percent to 6.13 percent, and the average one-year ARM notching higher to 5.77 percent.

Mortgage rates increased following the Federal Reserve's 15th interest rate hike since June 2004. The repeated interest rate hikes continue to consistently push adjustable mortgage rates higher. On the other hand, fixed mortgage rates didn't increase because of the Fed rate hike, but because of what the Fed said in the post-meeting release. While some of the Fed's cast has changed, most notably Chairman Ben Bernanke taking over for Alan Greenspan, and some of the words in the statement changed, the message was much the same as in January. In fact, in one key paragraph, the Fed retained the exact language used by the Greenspan-led Fed in January, saying "some further policy firming may be needed." The bond market did not greet such an announcement warmly, with the yield on 10-year Treasury notes instantly moving higher, now the highest since June 2004. Fixed mortgage rates are closely related to yields on long-term government bonds.

Fixed mortgage rates are less than one-half of a percentage point higher than six months ago. At the end of September, the average 30-year fixed mortgage rate was 5.97 percent, meaning that the monthly payment on a loan of $165,000 was $986.08. Despite sharp increases in short-term interest rates since, the average 30-year fixed rate is still just 6.44 percent, meaning the same loan originated now would carry a payment of $1,036.41. Fixed mortgage rates remain an attractive refinancing alternative for adjustable rate borrowers.