Dropped Loan Rates Let Borrowers Rush to Refinance Mortgage

TARZANA, Calif. - Dec. 28, 2021 - PRLog -- Last week, mortgage rates fell for the second week in a row, helping to stimulate refinance demand in California for the first time in a long time. According to the Mortgage Bankers Association's seasonally adjusted index, total mortgage application sales grew 5.5 percent more than last week.

The average contract interest rate on 30-year fixed-rate mortgages with conforming loan amounts fell to 3.16 percent from 3.24 percent, with points for loans with a 20% down payment remaining flat at 0.34 (including the closing fee).

The rate has dropped 14 basis points in the last two weeks, but it is still 18 basis points higher than it was a year ago during the same period.

Refinance demand, which is particularly sensitive to weekly rate changes, increased by 7% last week compared to the week before. However, it was 28% lower than the previous year. The refinance percentage of total mortgage applications grew to 63.5 percent from 61.9 percent the previous week.

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Despite the fact that overall activity is still at the January 2020 lows, homeowners took advantage of the lower rates. Furthermore, the average loan sum for a refinance application reached a new high in a month.

Mortgage applications for house purchases grew 3% this week, but were 4% lower than the same period a year earlier. The housing market is in the midst of its sluggish season, and while demand is higher than usual, purchasers are still confronted with a scarce and expensive market.

Although the brief decline in rates may have enticed some purchasers, given today's high prices, it didn't provide them with much additional purchasing power.

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The official spokesperson said: Refinance Mortgage (https://www.online.calsunmortgage.com/refinance-mortgage/) interest will continue to go down as the number of lenders will increase. The more the number of mortgage lender would be the lower the interest will go. They even said, as the interest will go lower, the number of borrowers will also increase. Their whole motto of saying this is that the number of lenders and borrowers will increase but the interest rate will go down. They also said, as this happens borrowers will happily get their mortgage approved in no time.