The financial situation for banks continues to be volatile, and the situation they face has caused them to reduce their mortgage rates again, for the sixth consecutive week. Now, the rates sit at their lowest level in over several months, which have spurred an interest in homeowners wanting to apply for refinancing.
The 30-year fixed-rate mortgage, which is used as a benchmark for evaluations, has fallen by 12 basis points, reducing them to 5.8%. This information comes from a national survey taken of the largest lenders. Basis points are calculated as being one-hundredth of a percentage.
Another benchmark, the 15-year fixed-rate mortgage, has managed to fall a total of 16 basis points, reducing their rates to around 5.51 percent.
The number of applications for mortgages continues to fluctuate. Depending on how you count the figures, the number of applications has managed to either go up or down in the past month. Factors such as the Thanksgiving holiday have to be considered; the effect that day has had on the lives of people applying for mortgages is particularly pronounced. According to the Mortgage Bankers Association, the raw number of applications for mortgages rose by roughly 33%.
Bob Walters, Quicken Loan’s chief economist, has mentioned his thoughts on this subject. He believes that the recent drop in mortgage rates has proven to be a huge incentive for consumers looking to refinance and obtain a fixed-rate loan. He also feels that those who are looking to enter the market in order to purchase a home have an outstanding opportunity to acquire a cheap investment.
It does seem like borrowers are looking for more security than ever before. Only 1.1% of all applicants for a home mortgage were asking for adjustable-rates in recent history. Those that already have adjustable mortgages are trying to refinance into loans with fixed-rates as well, in order to obtain the certainty they desire when it comes to making monthly loan payments.
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