Adjustable-rate mortgage demand jumps as buyers struggle

As mortgage rates hover near the highest level in more than two decades, homebuyers are turning to riskier mortgage products to help them get into a home.

Last week, the average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($726,200 or less) decreased to 7.86% from 7.90%, with points falling to 0.73 from 0.77 (including the origination fee) for loans with a 20% down payment, according to the Mortgage Bankers Association. That is still 80 basis points higher than the same week one year ago.

Adjustable-rate mortgages, which are considered riskier because the rates…