Michael Fratantoni Archives

Rising Mortgage Rates Still Low Historically

According to the Mortgage Bankers Association’s Weekly Applications Survey, average mortgage rates rose again last week. Rates moved up for all loan types except those backed by the Federal Housing Administration. Still, despite steadily increasing over the past month, mortgage rates remain low by historical standards. In fact, since 1980, mortgage rates have been as high as 18 percent – though they spent most of the past 40 years somewhere between 7 and 10 percent. In other words, mortgage rates are up from their all-time lows but remain far lower than they’ve typically been. The increases, however, have had an impact on refinance activity, which is more sensitive to rate fluctuations. “Refinances are almost entirely driven by mortgage rates, while purchase activity is a function of a broader set of variables including the state of the job market, demographics, and consumer confidence,” Michael Fratantoni, chief economist for the MBA, told CNBC. As proof, Fratantoni points to the fact that purchase application demand has actually risen 12 percent over the past month, while the group’s refinance index has fallen over the same period. The MBA’s weekly survey has been conducted since 1990 and covers 75 percent of all retail residential mortgage applications. More here.

Mortgage Rates Increased Again Last Week

According to the Mortgage Bankers Association’s Weekly Applications Survey, average mortgage rates were up again last week across all loan categories, including 30-year fixed-rate loans with both conforming and jumbo balances, loans backed by the Federal Housing Administration, and 15-year fixed-rate loans. The increase brought rates to their highest level in over a year. As a result, refinance demand fell sharply. In fact, refinance activity was down 16 percent from the week before. Demand for loans to buy homes, on the other hand, was relatively flat – though the trend toward higher-balance loans may be an indication that younger buyers are being deterred by rising rates. “The mix continues to shift towards higher balance loans, as the average purchase loan size reached a new survey record,” Michael Fratantoni, MBA’s chief economist, told CNBC. “First-time buyers and buyers of lower priced units may have stepped away from the market to some extent given the jump in rates.” The week’s results include an adjustment for the Thanksgiving holiday. The MBA’s weekly survey has been conducted since 1990 and covers 75 percent of all retail residential mortgage applications. More here.

Higher Mortgage Rates Bring The Buyers Out

For the fourth straight week, average mortgage rates increased from the previous week. In fact, according to the Mortgage Bankers Association’s Weekly Applications Survey, rates were up across all loan categories, including 30-year fixed-rate loans with conforming and jumbo balances, loans backed by the Federal Housing Administration, and 15-year fixed-rate loans. Michael Fratantoni, the MBA’s chief economist and senior vice president of research and technology, says the increases are being driven by expectations of future economic growth and inflation. “Mortgage rates have continued to move higher in the post-election period, as investors worldwide are looking for increases in growth and inflation, with the 30-year mortgage rate reaching its highest weekly average since the beginning of 2016,” Fratantoni said. But while the highest rates since January have caused refinance activity to fall, prospective home buyers look to be locking in low rates before they go up any further. Last week saw a 19 percent increase in demand for loans to buy homes. The spike puts purchase loan demand 11 percent above where it was at the same time last year. The MBA’s weekly survey has been conducted since 1990 and covers 75 percent of all retail residential mortgage applications.

Mortgage Rate Bump Leads To Slower Demand

According to the Mortgage Bankers Association’s Weekly Applications Survey, average mortgage rates increased last week from the week before. The increase brought rates to their highest level since June and caused a slight dip in overall demand for mortgage loans. Refinance activity – which is generally more sensitive to rate fluctuations – fell 2 percent, while demand for loans to buy homes was down less than 1 percent from the week before. Michael Fratantoni, MBA’s chief economist, told CNBC there are several factors that point to more rate increases in the near future. “Globally, rates have begun to creep upwards as investors anticipate less aggressive monetary policies from central banks, and U.S. rates are being pushed upwards in response,” Fratantoni said. “Additionally, new data show continued positive signals regarding the job market and rising inflation, indicating the Fed is likely to hike in December and will continue increasing rates next year.” But, though rate increases are expected in the coming months, they are also expected to be gradual – likely keeping rates low by historical standards, at least in the near term. The MBA’s weekly survey has been conducted since 1990 and covers 75 percent of all retail residential mortgage applications. More here.

Home Buyers Not Deterred By Rate Increase

According to the Mortgage Bankers Association’s Weekly Applications Survey, demand for loans to buy homes rose 3 percent last week despite a bump in mortgage rates. Average rates rose for 30-year fixed-rate loans with both conforming and jumbo balances, as well as 15-year fixed-rate loans. Rates for loans backed by the Federal Housing Administration were unchanged from one week earlier. Higher rates didn’t stop buyers, however. In fact, the MBA’s purchase index is now 13 percent above where it was last year at this time. That’s due, in part, to the fact that rates – though at their highest level since June – are still low by historical standards. Refinance activity, on the other hand, is more sensitive to rate increases and saw a 1 percent decrease last week. Michael Fratantoni, MBA’s chief economist, says average mortgage rates are as high now as they were the week of the Brexit vote in June. “Refinance applications dropped to the lowest level since the week of the Brexit vote, as mortgage rates reached their highest level since then,” Fratantoni said. The MBA’s weekly applications survey has been conducted since 1990 and covers 75 percent of all retail residential mortgage applications. More here.

Average Mortgage Rate Drops Again

According to the Mortgage Bankers Association’s Weekly Applications Survey, average mortgage rates fell last week across all loan categories, including 30-year fixed-rate loans with both conforming and jumbo balances, loans backed by the Federal Housing Administration, and 15-year fixed-rate loans. The drop marked the second consecutive week of declines and brought rates to their lowest level since July. But, though the decrease stirred up refinance activity, purchase application demand was flat from the week before and down 14 percent from last year’s level. Michael Fratantoni, MBA’s chief economist, told CNBC the numbers may not tell the whole story. “The mortgage industry is celebrating the one year anniversary of the TRID/KBYO regulatory implementation date this week,” Fratantoni said. “Purchase application volume last week was almost 14 percent below the same week a year ago. That was the last week for mortgage applications to be covered by the prior disclosure regulations and as a result there was a spike in application activity.” In other words, though this week’s results show year-over-year purchase activity down significantly, it should return to normal with next week’s survey. The MBA has conducted their weekly survey since 1990. It covers 75 percent of all retail residential mortgage applications. More here.

Survey Finds Average Mortgage Rates Down

According to the Mortgage Bankers Association’s Weekly Applications Survey, average mortgage rates decreased last week across all loan categories, including 30-year fixed-rate loans with both conforming and jumbo balances, loans backed by the Federal Housing Administration, and 15-year fixed-rate mortgages. Michael Fratantoni, MBA’s chief economist, says the Fed’s decision to leave rates unchanged led to the drop. “Treasury rates fell through the course of last week, as the Fed left their target rate unchanged, and concerns grew again about global growth, particularly in Europe and Japan,” Fratantoni said. “Refinance volume dipped for the week, but purchase application volume continues to show 2016 as a strong year.” Last week, demand for loans to buy homes was up slightly from the week before and 10 percent higher than the same week one year earlier. The size of the average loan was also up, however – which indicates that much of the buying activity remains on the higher end of the market. Refinance activity, on the other hand, was down 2 percent from the previous week, despite declining rates. The MBA’s weekly survey has been conducted since 1990 and covers 75 percent of all retail residential mortgage applications. More here.

Average Mortgage Rates Up Over Week Before

According to the Mortgage Bankers Association’s Weekly Applications Survey, average mortgage rates increased last week across all loan categories, including 30-year fixed-rate loans with both conforming and jumbo balances, loans backed by the Federal Housing Administration, and 15-year fixed-rate mortgages. Rates increased to levels last seen in June, though they remain low by historical standards. Michael Fratantoni, MBA’s chief economist, told CNBC the jump was spurred, in part, by speculation that the Federal Reserve may raise interest rates this week. “Mortgage rates increased to their highest level since June last week as comments by some Fed officials made it appear that the Federal Reserve is closer to raising rates,” Fratantoni said. “The average refi loan size fell to its lowest level in three months as more jumbo borrowers left the market.” But while refinance and purchase application demand did fall from one week earlier, they both remain up from last year, with refinance activity 26 percent higher than at the same time one year ago. The MBA’s weekly survey has been conducted since 1990 and covers 75 percent of all retail residential mortgage applications. More here.

Mortgage Rates Hold Steady Near Lows

According to the Mortgage Bankers Association’s Weekly Applications Survey, average mortgage rates were relatively flat last week across all loan categories, including 30-year fixed-rate mortgages with both conforming and jumbo balances, loans backed by the Federal Housing Administration, and 15-year fixed-rate loans. With rates still hovering just above historic lows, demand for mortgage loan applications saw a bump over the week before. In fact, the seasonally adjusted purchase index rose 1 percent from the week before, while the refinance index – which is generally more sensitive to rate movement – saw a 4 percent increase. Michael Fratantoni, MBA’s chief economist, says with rates as low as they are, there should be an even greater increase in the number of borrowers taking advantage of favorable conditions. “The last time rates were at these levels, the refi index was almost twice as high,” Fratantoni told CNBC. “At these rate levels, there are borrowers who still stand to benefit, but there are many homeowners who have already taken advantage of refinancing and are not yet incentivized to do it again.” The MBA’s weekly survey has been conducted since 1990 and covers 75 percent of all retail residential mortgage applications. More here.

Mortgage Rates Increased Last Week

According to the Mortgage Bankers Association’s Weekly Applications Survey, average mortgage rates rose across all loan categories last week, including 30-year fixed-rate loans with both conforming and jumbo balances, loans backed by the Federal Housing Administration, and 15-year fixed-rate mortgages. The increase slowed mortgage demand, especially refinance activity. Michael Fratantoni, MBA’s chief economist, told CNBC activity has been up-and-down lately, despite the fact that rates are well below where they were last year at this time. “Despite the 30-year fixed mortgage rate being almost 50 basis points lower than a year ago, refinance activity has been extremely sensitive to rate increases as the pool of borrowers who can benefit from refinancing continues to diminish,” Fratantoni said. But it wasn’t just refinance activity, demand for loans to buy homes was also down, dropping 3 percent from the week before. Still, total mortgage application volume is up 42 percent from the same week one year ago. And though that increase can partly be credited to rising refinance demand spurred by declining mortgage rates, home sales are also up over last year. The MBA’s survey has been conducted weekly since 1990 and covers 75 percent of all retail residential mortgage applications. More here.