Mortgage Rates Increase, Still Near Historic Lows

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According to the Mortgage Bankers Association’s Weekly Applications Survey, mortgage rates increased last week across all loan categories, including 30-year fixed-rate loans with conforming and jumbo balances, mortgages backed by the Federal Housing Administration, and 15-year fixed-rate loans. Naturally, the increase caused a decline in refinance and purchase activity during the week. In fact, refinance demand fell 16 percent from the week before and purchase activity fell 7 percent. Michael Fratantoni, MBA’s chief economist, said mortgage rates hit their highest level since the beginning of the year and, as a result, mortgage application volume dropped. According to Fratantoni, refinance volume fell particularly for larger loans, resulting in an almost $25,000 drop in the average refinance loan size. It was the second consecutive week mortgage rates increased after falling to a 19-month low earlier this month. The MBA’s weekly survey has been conducted since 1990 and covers 75 percent of all retail residential mortgages. More here.

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