Home Mortgage Refinancing Activity Rises 17%
ByIn their weekly mortgage rate report, the Mortgage Bankers Association indicated that home mortgage refinancing activity had risen17% from the previous week. This is great news if you were considering refinancing your mortgage.
The report also mentioned that home purchase loan applications made up less than 20% of the weekly volume of loan applications. This is another sign that the housing sector remains sluggish. Home buyers are clearly not motivated enough to finance a new home even as mortgage rates have fallen to historic levels. Last week the average 30-year home loans with fixed rates increased to 4.6% from 4.57%, according to the MBA. Clearly, low rates alone aren’t going to bring home buyers back to the market. As we’ve said before the employment numbers need to get better.
That’s because investors have begun paying more for mortgage bonds than in the past, enabling lenders to cover some home refinance costs that borrowers would traditionally bear. Some economists are holding on to their hopes that mortgage refinancing is the second best way to stimulate the economy behind new jobs. However some insiders are not confident that another mortgage refinancing wave will have much of an impact on our nation’s recovery. While it can put money into borrowers’ pockets, some homeowners are using low refinance rates to consolidate debt, by refinancing into home loans with shorter terms and knocking off several years of mortgage payments.
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