Loan Applications Rise as Rates Reach Record Lows

September 27, 2012

More home owners and purchasers took advantage of locking in last week’s record low rates. Mortgage applications — which include both for refinancing and purchase — rose 2.8 percent for the week ending Sept. 21, the Mortgage Bankers Association reports. 

Mortgage applications for home purchases, an indicator for future home sales, increased 0.7 percent last week. Applications for refinancing rose 3.3 percent, as more home owners tried to trim their monthly mortgage payment by locking in a lower rate. 

Mortgage rates last week sank to record lows, following the Federal Reserve’s announcement of more stimulus efforts on the way. The Fed announced it would purchase $40 billion in mortgage-backed securities every month, which is expected to send rates even lower. The 30-year fixed-rate mortgage averaged 3.63 percent, its lowest level on record, according to the MBA. 

Source: “Mortgage Applications Rose as Rates Hit New Lows,” NBC News (Sept. 26, 2012)