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Mortgage-Refinance Activity Triples Despite Higher Home-Loan Rates

Mortgage-Refinance Activity Triples Despite Higher Home-Loan Rates
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Wednesday, 16 October 2019 12:50 PM

Mortgage applications increased 0.5 percent while refinancing activity tripled despite higher rates for 30-year home loans.

According to data from the Mortgage Bankers Association's (MBA) Weekly Mortgage Applications Survey, the Market Composite Index, a measure of mortgage loan application volume, increased 0.5 percent on a seasonally adjusted basis from one week earlier. The unadjusted Purchase Index decreased 4 percent compared with the previous week and was 12 percent higher than the same week one year ago.

The Refinance Index increased 4 percent from the previous week and was 199 percent higher than the same week one year ago. 
 
"The ongoing interest rate volatility is impacting a borrowers' ability to lock in the lowest rate possible. Despite a slight rise in mortgage rates last week, refinance applications increased 4 percent and were 199 percent higher than a year ago," said Joel Kan, Associate Vice President of Economic and Industry Forecasting.

"Purchase applications slowed for the second week in a row. While near term economic uncertainty is still a factor, other fundamental issues, such as a lack of housing inventory in many markets, is preventing purchase activity from meaningfully rising. However, purchase applications were still much higher than a year ago. This is a reminder that the purchase environment in 2019 continues to be stronger than in 2018." 
 
The refinance share of mortgage activity increased to 62.2 percent of total applications from 60.4 percent the previous week. 
 
The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($484,350 or less) increased to 3.92 percent from 3.90 percent.

The average contract interest rate for 15-year fixed-rate mortgages decreased to 3.32 percent from 3.35 percent.

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Mortgage applications increased 0.5 percent while refinancing activity tripled despite higher rates for 30-year home loans.
mortgage, refinance, home, loan, rates
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2019-50-16
Wednesday, 16 October 2019 12:50 PM
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