The MBA Weekly Mortgage Applications Survey’s market composite index increased 0.9% on a seasonally adjusted basis from the previous week. The Refinance Index increased 1 percent from the previous week. There is also an increased risk that election uncertainty will have a near-term impact in dampening purchasing activity, although there is also the possibility that there will be an increase in refinancing as a precautionary measure. An increase was also seen in applications for home purchase as it grew by 1.0% on the week reaching a 7.0% gain for the year as overall demand showed a robust firmness.
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The average benchmark 30-year fixed-rate mortgage rate increased slightly to 3.68% in the latest week from 3.67% previously.
“Is it time for us to get out of our existing mortgage, pay a penalty (if necessary) and refinance at a lower rate?”
The 30-year fixed-rate mortgage decreased to 3.44% for the week ending September 8, 2016. The Veterans Affairs share of total applications was 11.9%, down from 12.5%, and the U.S. Department of Agriculture share remained unchanged at 0.6%. The majority – 61 percent – expect mortgage rates will remain more or less unchanged over the next week, while 31 percent predict a decline.
The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA decreased to 3.52 percent from 3.54 percent, with points decreasing to 0.35 from 0.36 (including the origination fee) for 80 percent LTV loans.
Interest rates did have the potential to move much higher after the release last Friday of the weaker-than-expected August employment report. The effective rate decreased from last week.
The 15-year fixed mortgage rate eased to 2.76 per cent from 2.77 per cent.
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The average rate for a 5/1 adjustable-rate mortgage (ARM) was 2.87%, down from 2.90%.
