Mortgage rates experienced a slight decline last week, prompting a significant increase in mortgage demand for the second consecutive week. According to the Mortgage Bankers Association’s (MBA) seasonally adjusted index, total application volume surged by 7.1% compared to the previous week.
The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($766,550 or less) dipped to 6.84% from 7.02%. Additionally, points fell to 0.65 from 0.67 (inclusive of the origination fee) for loans featuring a 20% down payment.
Mike Fratantoni, Senior Vice President and Chief Economist at the MBA, attributed the decline in mortgage rates to recent economic data indicating a weaker service sector and a less robust job market. Factors such as an uptick in the unemployment rate and downward revisions to job growth in previous months influenced the shift in rates.
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Consequently, applications for home loan refinancing, which tend to be highly responsive to weekly rate fluctuations, saw a notable uptick of 12% for the week. This increase in refinance applications also marked a 5% rise compared to the same week one year ago.
In another story, A mortgage is an arrangement between you and a lender that provides the lender the right to repossess your property if you fail to repay the loan plus interest.
Mortgage loans are used to buy a home or to borrow money against the value of a home you already own.
Lenders will tell you how much you are qualified to borrow – that is, how much they are willing to lend you. Several online calculators will compare your income and debts and come up with similar answers..read in full
