Average Mortgage Rates Continue To Rise

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Though still historically low, average mortgage rates have been on the rise in recent weeks. In fact, according to the Mortgage Bankers Association’s Weekly Applications Survey, last week saw rate increases across all loan categories, including 30-year fixed-rate mortgages with both conforming and jumbo loan balances, loans backed by the Federal Housing Administration, and 15-year fixed-rate loans. The latest increase caused a decline in demand for both refinance and purchase loan applications. Mike Fratantoni, MBA’s chief economist, said rising rates are creating volatility in weekly mortgage application activity, noting that refinance activity reached its lowest level since January. Still, despite the weekly ups-and-downs, the number of loan applications to buy homes is now 15 percent higher than it was one year ago. And, since purchase application demand is generally a good indicator of future home sales, the year-over-year improvement suggests that home buyers still see buying as a good deal and have increasing confidence in their personal financial situation due to a rebounding economy and labor market. The MBA’s weekly survey has been conducted since 1990 and covers 75 percent of all retail residential mortgage applications. More here.

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