Rates Hit All-Time Lows As Mortgage Refinance Again Begins to Pick Up Steam
September 20, 2012
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Despite an overall decline in the mortgage markets, the Mortgage
Bankers Association announced in its seasonally adjusted index of
loan activity that refinance has been taking off recently.
With an increase of 0.8 percent, mortgage refinance now
accounts for 81 percent of total activity, which is an uptick from
the previous few weeks.
New loan applications, which indicate the number of home sale
starts conducted throughout the week, fell by 3.8 percent. However,
this coincides with average yearly trends where home sales peak in
the spring and decline in the fall.
The increase in the number of mortgage refinances has coincided
with a significant drop in the average interest of fixed rate
loans. After bottoming out back in early July before a slight
uptick in rates, average interest has reached all time lows.
Many analysts attribute the dip in mortgage rates to an
announcement by the Federal Reserve Chairman Ben Bernanke that the
central bank would buy distressed mortgages and take other steps to
keep interest rates low and help the economy.
As well, President Barack Obama has been pushing for Congress to
pass further improvements to the
Home Affordable Refinance Program (HARP 2.0) to make it even
easier for borrowers to lower their monthly payments.
If all of this good news has you interested in reevaluating your
finances, contact a professional at New Penn Financial to decide
what options are available to you.
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