Mortgage interest rates in the Washington area rose again yesterday, pushed to near record highs by the Carter adminstrations's latest efforts to bolster the sagging dollar.
Many Virginia lenders boosted their mortgage rates for the second time in a week. Prevailing rates now range from 10 percent with 20 percent down to 11 1/4 percent for loans with a five percent downpayment.
One of the District of Columbia's biggest lenders raised its top rate to 10 percent - just below the new 11 percent temporary ceiling set by the District's usury law.
In Maryland, where the law sets a 10 percent limit, two of the biggest banks raised their rates to 10 1/2 percent, taking advantage of a rarely use federal law that allows them to ignore the state's limit.
Under the law, federally chartered banks are allowed to charge one percent more than the Federal Reserve's discount rate, regardless of state statues.
At President Carter's urging, the Fed raised the discount rate to 9.5 percent last Thursday, and yesterday Maryland National Bank and First National Bank of Maryland raised their rates maximum mortagage rate one point above that.
Even at that rate, mortgages are only being offered to regular customers, said Jeffery R. Springer, senior vice president for real estate at Maryland National.
Maryland savings and loan associations and state chartered banks which are subject to the 10 percent limit have either stopped making mortgage loans or sharply restricted the terms.
"I'd say 75 or 80 percent of the S&L's in the metropolitan area are out of the market," said Charles Kresslein, president of the Maryland Saving and Loan League.
Kresslein said the housing industry will ask the Maryland legislature to pass emergency legislation eliminating the 10 percent ceiling when it meets in January. If two-thirds of each house agrees, the ceiling could be ended immediately.
If the ceiling is not removed, many Maryland lenders will be unable to make loans until rates come down, warned the savings and loan spokesman.
Three of Maryland's biggest mortgage lenders, Loyola Federal, Provident Savings Bank and the Savings Bank of Maryland, announced they were raising their minimum downpayment from 20 percent to at least 25 to 40 percent.
The combination of toughened down payment terms and limited loans to customers indicate actual mortgage interest rates may be reaching their peak, said Thomas Harder, chief economist for the Mortgage Bankers Assn. of America.
But Harder said there is little prospect rates will recede, noting that mortgage bankers are making committments for mortgages four months from now at 10.6 percent rates, about the same as today.
Although interest rates in the Washington area are at or near their 1974 peaks, they remain about one quarter to one half percent below California rates, he noted.
Lenders say their major source of funds now is six-month certificates of deposit whose interest rate is tied to that of treasury bills. Those certificates now yield 9.6 percent.
Most District of Columbia lenders are quoting rates in the 10 1/4 to 10 1/2 range, said Bruce Bryan executive vice president of the local savings and loan league. One of the district's biggest lenders, Columbia Federal yesterday raised its rate to 10 percent for loans up to 90 percent of the value of a property.
A bill to make permanent the 11 percent ceiling on loans in the District has passed the city council and will go into effect in January, unless rejected by Congress.
Northern Virginia's biggest mortgage lender First Federal of Arlington, yesterday raised its rate to 20 percent, for loans up to $75,000 with 20 percent down. Both buyer and seller must pay one "point" - an additional one percent of the loan up front.
With smaller down payments rates go up, to a high of 11 percent at First Federal of Arlington, and the buyer must pay an additional quarter percent for private mortgage insurance.