Thursday, April 7, 2016

Mortgage Applications Up 2.7% on Refi Push

Home owners rushed last week to refinance and lock in savings as mortgage rates posted a sharp drop.
Total mortgage application volume, including for refinances and home purchases, climbed 2.7 percent last week on a seasonally adjusted basis over the previous week, the Mortgage Bankers Association reported Wednesday. Loan volume is about 3 percent higher now than a year ago.
The increase this week was largely attributed to the 7 percent week-over-week uptick in refinance applications. Still, refinance applications are down nearly 2 percent compared to a year ago. Higher mortgage rates in recent weeks have put the freeze on refinances, but that trend reversed last week as mortgage rates dropped.
The 30-year fixed-rate mortgage dropped 3.86 percent last week, compared to 3.94 percent the week prior, the MBA reports.
"This was the first increase in refinance activity after six weeks of declines," says MBA economist Joel Kan. "Applications for conventional refinance loans increased around 9 percent, while applications for government refinance loans were essentially unchanged."
Meanwhile, mortgage applications for home purchases dropped 2 percent compared to a week ago. However, purchase applications remain 11 percent higher than the same week a year ago.
"Agents broadly highlighted the continuation of low and relatively benign mortgage rates as supporting the usual seasonal uptick in spring traffic," Credit Suisse analysts noted in their monthly survey of real estate agents. "Limited inventory remains a challenge in several markets, though in a few cases short supply actually contributed to a build-up of demand and encouraged incremental urgency."
Source: “Refinance Reboot Pushes Mortgage Applications Up 2.7%,” CNBC (April 6, 2016)

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