Demand for Refinance Applications Increases Because of Lybia

Refi applications surged 17.8% from the previous week, according to figures from the Mortgage Bankers Association (MBA). However, mortgage applications for home purchases were up only 5.1 percent.

 

This activity was spurred by a significant drop in interest rates. The average rate on 30-year fixed-rate mortgages fell to 5.00% down from 5.12%. The average on 15-year fixed-rate loans dropped to 4.28% from 4.34%.

 

“Ongoing turmoil in the Middle East brought interest rates lower last week,” said Michael Fratantoni, MBA's Vice President of Research and Economics. “Borrowers took advantage of these lower rates, bringing application activity back near levels from two weeks ago, following sharp declines last week."

 

Higher oil prices due to the unrest in Lybia make investors nervous, meaning they are more willing to accept lower yields on “safe” investments such as bonds, sending interest rates in general downward.

Related Searches:

About The Author:

Stevie is the Senior Editor at Lender411. She manages the site's Authorship Program and social media pages. Stevie graduated from UC Santa Barbara with a BS. Contact her: stevie@lender411com.