As per the latest reports, a sharp rise in the number of mortgage applications has been witnessed in the last three weeks followed by the imposition of the lowest rate of interest on a 30-year in more than a year.
The Mortgage Bankers Association claimed that its seasonally adjusted index of mortgage application activity has experienced a modest rise in last week (which ended on 29th August). The activity including both the refinancing demand and home purchase had risen by 0.2%. There has been a 2.8% advance during the week prior to this one. The refinance figures went up by 1. per cent with the purchase gauge dropping by 1.5 per cent.
The fixed mortgage rates are likely to stay below the rates which prevailed at the beginning of the year. It has been reported that the rates had remained an all time low as a result of which the refinancing applications made for 57% of all the mortgage applications – which, once again, is another milestone, by virtue of being the highest since March, this year.
The 30 year fixed loan rate has plummeted to 4.25% (lowest since June 2013) with a gradual corresponding climb in the number of applicants seeking refinance, to 57% (which has been the highest since the month of February
While most of the borrowers out there are instructed that the new mortgage rates should at least be half of the existing rates, so as to cover the cost of refinance, even one eighth of the percentage on jumbo loans can help these borrowers to eke out considerable savings. People who have experienced a hike in pay, will be able to reap special benefits with refinancing since their new payment would be a lower percentage of their earning!