As mortgage rates plummet to three-year lows, more home owners are refinancing to lock in lower borrowing costs. The increase in refinancings helped to push overall mortgage applications up 2.9 percent week-over-week last week on a seasonally adjusted basis, the Mortgage Bankers Association reported Wednesday.
Mortgage applications are now nearly 35 percent higher than they were a year ago, MBA reports. Refinance applications last week were up 7 percent over the previous week.
Meanwhile, mortgage application volume hasn’t been getting much of a boost from the purchase side. Applications for mortgages to buy a home — viewed as a gauge of future home buying activity — dropped 2 percent during the week. A low number of listings has dented potential sales, CNBC reports. Nevertheless, purchase applications remain 12 percent higher than last year at this time.
MBA reports the average 30-year fixed-rate mortgage dropped to its lowest level since May 2013 last week, averaging 3.76 percent.
“Rates fell on concerns that Britain may vote to leave the European Union later this week,” says Lynn Fisher, MBA’s vice president of research. “Although beliefs about the likelihood of an exit have since moderated, the ‘Brexit’ vote promises to bring continued volatility to markets.”
Source: Realtor Mag http://realtormag.realtor.org/daily-news/2016/06/22/lowest-rates-in-3-years-boost-mortgage-apps (22 Jun 2016)