Rates Continue to Slip Amid Fears of a Coronavirus Resurgence
Overall, mortgage activity increased by 2.2% this week, though the data does include an adjustment for the Fourth of July holiday. Purchase applications increased 5% from this time last week while refinance applications increased 0.4%. Both metrics were also an increase from the same time last year.
Joel Kan, MBA’s Associate Vice President of Economic and Industry Forecasting, attributes the increase in applications to a decrease in rates, following fears of a coronavirus resurgence.
He reports, “Mortgage rates declined to another record low as renewed fears of a coronavirus resurgence offset the impacts from a week of mostly positive economic data, such as June factory orders and payroll employment. The 30-year fixed-rate slipped to 3.26 percent — down 53 basis points since late March. Borrowers acted in response to these lower rates, after accounting for the July 4th holiday.”
Kan also noted that the average purchase loan size also reached a record high in response to low inventory rates, saying, “The average purchase loan size increased to $365,700 — also another high — as borrowers contend with limited supply and higher home prices.”
More in Housing and Mortgage News
- Rocket Companies, Inc., the parent company for Rocket Mortgage and Quicken loans, made waves earlier this week by filing for an initial public offering (IPO) and disclosing its income for the last three years.
- In the commercial mortgage industry, mortgage delinquency rates jumped 213 basis points to a rate of 3.59% in June, the largest one-month spike since Fitch Ratings began tracking the metric in 2004.
- The Consumer Finance Protection Bureau (CFPB) recently proposed an escrow exemption for higher-priced mortgage loans under the Growth Act.
This Week in Mortgage Rates
Once again, rates dropped across the board this week.
Here’s a look at what happened with each type of loan:
- All 30-year, fixed-rate loans: 3.26%, 0.35 points
- Jumbo 30-year, fixed-rate loans: 3.52%, 0.36 points
- FHA 30-year, fixed-rate loans: 3.31%, 0.24 points
- 15-year, fixed-rate loans: 2.77%, 0.32 points
- 5/1 ARMs: 2.98%, 0.10 points
Be sure to check in next week for the most up-to-date information on where rates are headed next.
Information contained in this article may include links or references to third-party resources or content. Embrace Home Loans does not endorse or guarantee the accuracy of this third-party information. If you follow these links, you will be linking to a third party website not operated by Embrace. We are not responsible for the content of that website and its privacy & security policies may differ from those practiced by Embrace.
This information is distributed for professional use and is not intended to be shared with, or viewed by, consumers. To the average consumer, the information here may be misleading or exclude important disclosures.