Mortgage rates for 30-year loans are now at their most expensive level since early May of last year. Most other new purchase loan types increased as well.

Growing concern about the national debt impacted home borrowing rates this week. Mortgage rates track the benchmark 10-year Treasury yield, which climbed higher as bonds sold off

The average rate on the 30-year fixed mortgage rose this week to 6.86%, according to the latest Freddie Mac data released on Thursday. That is up from last week's reading of 6.81%.