A drop in the interest rate had negligible impact on mortgage applications but it does continue to boost mortgage refinancing. Year-over-year, though, both are showing substantial spikes.
CNBC reports total mortgage application volume was essentially unchanged, down 0.1 percent compared with the previous week, according to the Mortgage Bankers Association’s seasonally adjusted index. Volume was 60% higher than the same week one year ago, when interest rates were significantly higher.
Mortgage applications to refinance a home loan, which are most sensitive to weekly moves in rates, increased 2% for the week and were 144% higher than a year ago. Refinance volume is significantly higher this year because rates are so much lower. Last year, the average rate on the 30-year fixed was well over 5%.
Homebuyers pulled back slightly, more because of a tight for-sale market and having less to do with interest rates. Mortgage applications to purchase a home fell 3% for the week but were 7% higher than a year ago.
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