Declining mortgage rates are currently leading to spikes in refinance loans. During the week of June 7, 2019, the Market Composite Index jumped a staggering 26.8%.
Joel Kan, Mortgage Bankers’ Association vice president of economic and industry forecasting, said, “Despite a less positive economic outlook (think trade tensions between the US and China, weaker than exp3cted hiring in May 201i from some federal officials), both purchase and refinance applications have surged.” Kan continued by saying that the refinance index soared 47%.
CNBC put together a list of specifics on mortgage activities during mid-May. Take a look:
- The Refinance Index spike +47% from the week of June 1 to June 7, 2019.
- The refinance share of mortgage activity increased to a whopping 49.8% from a week earlier when that index was 42.2%.
- The seasonally adjusted Purchase Index increased +10% from the week before, June 1 to June 7.
- The adjustable rate mortgage sector of mortgage activity increased to 7.9% of total mortgage applications.
- The share of FHA mortgage applications fell from 9.5% to 8.9% of all mortgage activity.
- The share of VA mortgage applications fell to 11% of all mortgage activity from11.3% the week before.
- Mortgage interest rates for a 30-year fixed mortgage with a conforming loan balance (greater that $484,350) dropped from 4.24% to 4.09%
- An average contract interest rate for a 30-year fixed-backed by the FHA dropped 4.24% to 4.09%.
- The average mortgage rate for a 15-year fixed loan fell to 3,53% from 3.65%.
- The average contract interest rate for 5/1 ARMs fell to 3.43% from 3.62%.
As of mid-May mortgage activity, Kan concluded by saying, “”30-year fixed rate mortgages are at their lowest level since September 2017 and purchase mortgage activity is +10% higher than a year ago. Demand is relatively strong but supply continues to be tight for first-time buyers.”
