The 30-year, fixed-rate mortgage decreased again this week, to 3.62 percent, according to the Oct. 5 Weekly Mortgage Applications Survey conducted by the Mortgage Bankers Association (MBA). The figure is at its lowest since July.
Rates for jumbo-loan and Federal Housing Administration-backed mortgages also decreased. Jumbo-loan rates dipped to 3.60 percent, from 3.64 percent, and Federal Housing Administration-backed rates dropped to 3.50 percent, from 3.52 percent. Both rates are down from the previous week.
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On a more upbeat note, mortgage applications increased 2.9 percent for the period ending Sept. 30. The refinancing market experienced an increase, as well, with total applications coming in at 63.8 percent, compared to 62.7 percent before. The percentages indicate the number of homeowners applying for the option when submitting loan documents.
“As mortgage rates continue to stay below 4 percent, it seems more homeowners are refinancing and staying put instead of looking to trade up to another home,” according to an article on NerdWallet.
What goes down must go up, industry executives warn. Perhaps consumers have the jitters about the possibility of rising mortgage rates and want to get the most bang for their buck while the environment is financially favorable.
Another factor affecting the market: the November presidential election.
“If the elected president reduces U.S. corporate tax rates or impacts policy to improve business, stocks are expected to rise,” Julie Morris, associate broker at Julie Morris Premier Team at HomeSmart, told The Mortgage Reports. “And if stocks rise, funds will be pulled out of the bond market, causing interest rates to rise.”
Headquartered in Washington D.C., the Mortgage Bankers Association is the national association representing the real-estate finance industry. Since 1990, it has conducted a weekly survey that covers more than 75 percent of all U.S. residential-mortgage applications. Respondents include commercial banks, mortgage bankers and thrifts.