08 Aug 1990 Palm Beach Post
Ml ortgage rates shoot up amid ideast crisis M By CHARLES ELMORE Palm Beach Post Staff Writer The invasion of a tiny desert country on the other side of the world made buying a house in America suddenly more expensive this week. Iraq's invasion of Kuwait jacked up oil prices, which raised inflation fears, making nervous lenders tack extra fees onto mortgages mortgages faster than a home buyer could say Saddam Hussein. At NCNB National Bank, for example, the 30-year 30-year 30-year fixed rate shot up to 10.13 percent Tuesday morning from 9.75 percent Friday. For someone borrowing $150,000, that represents a difference of more than $41 a month, or close to $15,000 over 30 years. "Unfortunately, home buyers found themselves stuck in the middle middle of world events," said Sheila Tshinkel, research director for the Federal Reserve Bank in Atlanta. The average 30-year 30-year 30-year fixed mortgage rate among 67 lenders in Palm Beach and Martin counties dipped last week to 9.96 percent, according to a weekly survey by Bank Rate Monitor of North Palm Beach. It was the first time the region's average dipped into single digits since January. But it now appears the visit below 10 percent may be brief. People who shopped for a mortgage mortgage last week have awakened to rapidly rising rates in the past two days. Rates have jumped as much as a quarter of a percentage point daily. "It's really a shame," said Les Grene, vice president for NCNB in Palm Beach County. "The rise in interest rates isn't really warranted warranted as far as the economy goes. It's because of what's going on." The "Kuwaiti gamble" confronting confronting home buyers is whether to "lock in" a rate this week, figuring rates may keep heading north because because of oil-related oil-related oil-related turmoil, or wait a couple months before closing closing the sale hoping rates will settle. 'Sticker shock' At Secor Bank, some customers suffered "sticker shock," said loan production manager Doris Jackson. Jackson. Last week, Secor offered a 9.88 percentage rate. But this week the lender more than doubled the. points add-on add-on add-on fees paid at closing closing to 2.63 from 1.25, Jackson said. One point equals one-hundredth one-hundredth one-hundredth one-hundredth of the total loan amount. The lowest rate in last week's area survey of 30-year 30-year 30-year fixed rates belonged to Goldome Savings at 9.38 percent with 2.25 points. As of Tuesday, Goldome's lowest rate was 9.75 percent with 2.75 points, a West Palm Beach loan officer said. Long-term Long-term Long-term mortgage rates usually usually parallel the yields on long-term long-term long-term Treasury bonds, which have climbed nearly half a point since Monday.