The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($726,200 or less) decreased to 7.07% from 7.17%, with points falling to 0.59 from 0.60 (including the origination fee) for loans with a 20% down payment, according to the Mortgage Bankers Association.
That was the lowest level since July.
“Mortgage rates dropped last week, as incoming data point to a slowing economy and support a pivot by the Federal Reserve to begin cutting rates next year,” said Mike Fratantoni, MBA senior vice president and chief economist.
As a result, applications to refinance a home loan increased 19% last week from the previous week, according to the Mortgage Bankers Association’s seasonally adjusted index. Refinance demand was 27% higher than the same week one year ago.
Applications for a mortgage to purchase a home rose 4% for the week but were still 18% lower than the same week one year ago.
Homebuyers may be getting a break from lower mortgage rates, but there is still tough competition in a market with high prices and few homes for sale.
(source:CNBC)
