After a month of cuts, the number of mortgage applications is now on the rise as existing homeowners and potential buyers take advantage of lower mortgage rates. Applications rose 3.2% last week compared to the previous week, according to a seasonally adjusted index released by the Mortgage Bankers Association.
After weeks of reductions, there has been an increase in the number of weekly applications for mortgages. At 6.42%, the average 30-year fixed mortgage rate was near its lowest level in a month. According to separate data from Black Knight, 8% of homebuyers with mortgages are underwater.
“The ongoing moderation in home-price growth, along with further declines in mortgage rates, may encourage more buyers to return to the market in the coming months,” Joel Kan, an MBA economist, wrote in a release.
The average contract interest rate for a 30-year fixed-rate mortgage with a conforming loan balance ($647,200 or less) rose slightly to 6.42% from 6.41% last week, and the number of points for loans with a 20% down payment was 0.64. 0.63 (including origination fee). Mortgage applications for home purchases increased 4% for the week, compared to a 38% decline from the same week last year. As rates decline, that annual comparison is currently getting smaller.