Mortgage rates slip, as mortgage applications surge

Mortgage rates slip, as mortgage applications surge

The benchmark 30-year fixed-rate mortgage fell this week to 4.04 percent from 4.06 percent, according to Bankrate’s weekly survey of large lenders.

As rates move ever closer to 4 percent, homeowners wanting to snag a lower interest rate on their existing mortgage are jumping into high gear, driving refinance application activity to a three-year high.

Consider this: A year ago, the 30-year fixed mortgage rate was 4.76 percent. Four weeks ago, the rate was 4.25 percent. The 30-year fixed-rate average for this week is 1.06 percentage points below the 52-week high of 5.10 percent, and is the same as the 52-week low of 4.04 percent.

The 30-year fixed mortgages in this week’s survey had an average total of 0.34 discount and origination points.

Over the past 52 weeks, the 30-year fixed has averaged 4.64 percent. This week’s rate is 0.60 percentage points lower than the 52-week average.

  • The 15-year fixed-rate mortgage fell to 3.38 percent from 3.41 percent.
  • The 5/1 adjustable-rate mortgage fell to 3.67 percent from 3.74 percent.
  • The 30-year fixed-rate jumbo mortgage rose to 4.11 percent from 4.10 percent.

At the current 30-year fixed rate, you’ll pay $479.72 each month for every $100,000 you borrow, down from $480.88 last week.

At the current 15-year fixed rate, you’ll pay $709.00 each month for every $100,000 you borrow, down from $710.47 last week.

At the current 5/1 ARM rate, you’ll pay $458.59 each month for every $100,000 you borrow, down from $462.55 last week.

Results of Bankrate.com’s weekly national survey of large lenders conducted June 12, 2019, and the effect on monthly payments for a $165,000 loan:

Weekly national mortgage survey
Breakdown 30-year fixed 15-year fixed 5-year ARM
This week’s rate: 4.04% 3.38% 3.67%
Change from last week: -0.02 -0.03 -0.07
Monthly payment: $791.54 $1,169.86 $756.67
Change from last week: -$1.91 -$2.42 -$6.53

Refinances lead latest mortgage application surge

Talk about a frenzy. Total mortgage applications shot up 26.8 percent from one week earlier, according to data from the Mortgage Bankers Association’s applications survey for the week ending June 7.

Refinance applications led the charge with a jaw-dropping increase of 47 percent week over week — the highest level in three years, the MBA reported. Meanwhile, purchase applications also enjoyed a boost from lower rates, surging 10 percent over the previous week.

“Mortgage rates for all loan types fell by a sizable margin for the second straight week, pulled down by trade tensions with China and Mexico, the financial markets reacting to more bearish communication from several Fed officials, and weaker than expected hiring in May,” said Joel Kan, MBA’s associate vice president of economic and industry forecasting. “Despite the less positive outlook, both purchase and refinance applications surged, driven mainly by these lower rates.”

Although demand is still relatively strong, Kan said there’s some lingering restraint from some would-be homebuyers who might be rattled by economic uncertainty. Plus, there’s the ever-present challenge of a lack of affordable housing for first-time buyers, Kan said.

Overall, the refinance share of volume increased to 49.8 percent of all mortgage applications, up from 42.2 percent the previous week. Lower rates are also a boon for the adjustable-rate mortgage, or ARM, share of activity, which rose to 7.9 percent of all applications, the MBA reported.

The “Bankrate.com National Average,” or “national survey of large lenders,” is conducted weekly. The results of this survey are quoted in our weekly articles and national media outlets. To conduct the National Average survey, Bankrate obtains rate information from the 10 largest banks and thrifts in 10 large U.S. markets. In the Bankrate.com national survey, our Market Analysis team gathers rates and/or yields on banking deposits, loans and mortgages. We’ve conducted this survey in the same manner for more than 30 years, and because it’s consistently done the way it is, it gives an accurate national apples-to-apples comparison.

Source: bankrate.com ~ By: Deborah Kearns ~ Image: 21 Online Asset Library