Home refinancing applications increased 20% from a week earlier, according to the Mortgage Bankers Association’s weekly seasonally adjusted index, which fell on a July 4 holiday.
According to the MBA, the number of mortgage applications increased by about 16% compared to a week earlier.
“Overall application numbers rose in the past week, largely driven by increased refinancing as rates fell again,” said Joel Kahn, MBA junior vice president of economic and industry forecasts. option and deceleration of economic growth ”.
However, “there could have been a delayed distribution of applications from the previous week, when rates also fell, but there was not much response in terms of refinancing applications,” added Kahn.
However, the latest rise in applications is due to a second straight week of mortgage rates falling, with the average 30-year fixed rate mortgage falling to 3.09% from 3.15%, the lowest level since February, according to Kahn.
These lower rates may prompt some home buyers to close their purchases, especially first-time homebuyers, Kahn noted.
The data comes a week after MBA reported the number of applications fell by about 1.8% to the lowest level since the beginning of 2020. However, while the average loan size fell to its lowest level since January, the number of purchase applications increased.
However, according to the MBA, the number of applications for purchases and refinancing has “dropped significantly” compared to last year and compared to a week without days off in 2020.
For example, according to the data, the number of home refinancing applications decreased by 29% compared to the same week last year.