Mortgage refinancing recovers when interest rates fall temporarily

Robin Azougi 1stR, a licensed real estate agent for Douglas Elliman Real Estate, speaks with potential buyers at a seller in Floral Park, Nassau County, NY on September 6, 2020.

Wang Ying | Xinhua News Agency | Getty Images

After falling for the third straight week, mortgage demand has returned thanks to lower interest rates.

Last week’s total application volume increased 4.2% from the previous week, according to the Mortgage Bankers Association’s seasonally adjusted index.

Refinancing led profits, rising 6% that week. It was 22% lower than the same week a year ago, as many borrowers had already refinanced in the fall of last year, when interest rates hit record lows. The refinancing share of mortgage activity increased from 60.4% last week to 61.7% of the total application.

Average contract rates for 30-year fixed rate mortgages ($ 548,250 or less) with matching loan balances have dropped from 3.15% to 3.11%, and points have dropped 20% from 0.34 (including origination fees) to 0.36. Has risen to. payment.

Joel Kang, MBA’s Vice President of Economy, Trade and Industry Forecasting, said: “Uncertainty in financial markets regarding inflation and how the FRB will behave in the coming months has led to the Treasury’s uncertainty. Yields have fallen. “

Mortgage applications to buy a home increased by 2% in a week, but decreased by 17% from a year ago. Home purchases have recently slowed due to significant price increases and a shortage of homes for sale. Lower mortgage rates are less effective at offsetting any of these factors.

Mortgage rates began this week as bond investors anticipate news from the Federal Reserve Board on Wednesday afternoon.

“Last week’s interest rate-friendly trend is on track and the market is now [Wednesday’s] Policy announcement from the Fed. Matthew Graham, Chief Operating Officer of Mortgage News Daily, said, “The Fed is not yet ready to adjust policy rates or change plans for bond-buying games, but in the future, those Talk about potential customers. “

Mortgage refinancing recovers when interest rates fall temporarily

Source link Mortgage refinancing recovers when interest rates fall temporarily

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