Demand for the purchase of loans has risen again, restraining the growth of mortgage rates

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Demand purchase of loans rose for the third straight week last week, even as mortgage rates rose to their highest level in a month, according to a weekly survey by the Mortgage Bankers Association.

Seasonally adjusted, the number of applications for purchase loans increased by 1 percent over the week, but decreased by 14 percent over a year ago. Refinancing requests, which accounted for 62.5 percent of all applications, were up 3 percent from the previous week, but 9 percent lower than a year ago.

Joel Kahn

“Over the past few weeks, there has been an upward trend in purchase requisitions,” said Joel Kahn of the MBA. “Activity was slightly higher for the third straight week, but remained lower than the same week a year ago. Public procurement applications were the main reason for the increase in the last week, which also contributed to a slightly lower overall average purchase loan size. ”

The MBA reported average rates for the following loan types for the week ending June 18:

  • For Mortgage loans with a fixed interest rate for 30 years (loan balance of $ 548,250 or less), average rates were 3.18 percent, compared to 3.11 percent. a week before… With an increase in the point to 0.48 from 0.36 (including processing fees) for loans with a loan-to-value (LTV) ratio of 80 percent, the effective rate also increased compared to the previous week.
  • Fixed rates for 30 years giant mortgage (the balance on loans exceeds $ 548,250), rates averaged 3.26 percent, up from 3.20 percent a week earlier. The points have dropped to 0.44 from 0.46, but the effective rate has still increased since last week.
  • For a 30 year flat rate FHA mortgage, rates averaged 3.21 percent, up from 3.14 percent a week earlier. The points have increased to 0.34 from 0.33 and the effective rate has increased since last week.
  • Tariffs for Mortgage with a fixed interest rate for 15 years an average of 2.58%, up from 2.49% a week earlier. The points have increased from 0.25 to 0.39 and the effective rate has increased from last week.
  • For 5/1 Adjustable Rate Mortgages (ARM), rates remained unchanged at 2.69 percent. The points are down to 0.26 from 0.38, so the effective rate is down from last week.

In their latest forecastEconomists at Fannie Mae predict that rates on 30-year fixed-rate mortgages will rise to 3.3 percent in 2022, triggering a $ 1.2 trillion cut in refinancing. Purchase loans are expected to remain unchanged next year at over $ 1.8 trillion.

Projected sources of mortgage lending

Origins are predicted for 2021 and 2022. A source: Fannie Mae Monthly Housing Forecast

Email Matt Carter



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