With the end of the government purchase of mortgage backed securities, rates have begun to climb and as a result, applications for refinances have gone down significantly from last week’s numbers.
According to the Mortgage Banker’s Association, the refinance index decreased almost 17% from last week, which is a staggering number. Additionally, refinance applications accounted for 58.7% of all applications, which is down from the 63.2% of last week.
On average, mortgage rates on 30 year fixed rate mortgages have already risen 0.3% and 15 year FRMs have risen 0.2% from last week.
Hopefully, this dip in mortgage and refinance applications is only a temporary function of the government MBS purchase program coming to an end. Even though rates are rising, they are still very low!
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