More takers for those low mortgage rates
So these low-low mortgage rates are having an effect on Americans after all: Applications for refinance deals jumped 17 percent last week to the highest level in 15 months.
That's according to the Mortgage Bankers Association, which surveys lenders. In its previous survey, it noted that applications for loans -- refinance and purchase -- barely budged despite the lowest rates since it began its survey in 1990.
Last week's rates were slightly higher than the week before, according to the survey -- 4.6 percent for a 30-year fixed-rate product rather than 4.57 percent.
Homebuyers, however, are not applying in droves. Applications for loans to purchase homes dropped 3.4 percent from a week earlier.
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Comments
Individuals are really digging in and trying to minimize debt - this latest trend represents those fiscally responsible enough to have equity doing their best to minimize debt burden. Smart move as long as they plan to hunker down for a few years to cover the (overpriced) closing costs.
Deflationary forces continue.....only another round of government folly (which would not surprise me) can keep home prices propped up
Posted by: Darwin Rules | August 19, 2010 12:11 PM
With these low rates, people who are currently underwater and do not have a federal mortgage that can be modified (which is most people), are going to buy another house then walk away from their current residence. I don't blame them.
Posted by: Jack | August 19, 2010 2:20 PM
Speaking of mortgage rates. Does anyone have the number of ARMs and Alt-As in Baltimore?
Posted by: ironhide196 | August 19, 2010 3:57 PM
Jack, you can still refinance even with a Fannie or Freddie loan up to 125% of the home's value. You still need to credit qualify and get an appraisal. If you have an FHA or VA mortgage, you can refinance without an appraisal. Also, people will not be able to "buy and bail" anymore. Lenders know this tactic and won't fall for it. When you try to sell your home, you will still have to qualify based on both mortgage payments. You aren't able to say you are going to rent out the current home and move in the new one. Even if someone does get away with it, that can be considered a form of mortgage fraud.
ironhide, rates on ARM's are around 3.5%. However, I would not recommend an ARM since fixed rates are so low right now. Also, the "Alt A" has been gone for about two years now. All that's left are Fannie, Freddie, FHA, and VA.
Posted by: Frank Rizzo | August 24, 2010 4:34 PM