Tag Archives: Refinance

Manic markets at home and fiscal crises overseas sent investors scurrying last week to buy up Treasury debt, a trend that sent mortgage rates plunging. Experts say the low mortgage rates are unlikely to boost sales.

Coupled with an interest in conforming jumbo loans, a wave of uncertainty over economic news helped throw homeowners into a refinancing frenzy last week, feeding a surge in mortgage applications across the board. Despite upticks, purchase applications continued to flat-line in a market overshadowed by weak consumer confidence, according to the Mortgage Bankers Association. Speaking to MReport, MBA VP Mike Fratatoni added his two cents about S&P's downgrades and the nation's long-term debt crisis.

On the heels of disappointing news in the broader economy, mortgage rates fell precipitously alongside Treasury bond yields Thursday, with Freddie Mac and Bankrate releasing reports that saw new lows for 30-year fixed-rate mortgages, 15-year rates, and 5-year adjustable-rate mortgages. Freddie Mac signaled the lowest pullback in 30-year fixed-rate mortgages for the year, with data for the category showing up at 4.39 percent on average, just down from 4.55 percent last week.

Citing dips in home sales, purchases, and low job growth, some economists say housing is already in a double-dip recession, with reprieve still off for another two years - this despite a last-minute debt deal.

Plummeting refinance applications crimped Federal Housing Administration mortgage loan applications over June, according to a report issued by the federal agency, with total volume falling 22 percent less than volume at the same time last year. The FHA attributed the plunge to a 50 percent decline in year-over-year numbers for refinance applications. Data from June last year suggests a sharp decline in refinance loan applications, which dropped from 69,876 to 35,367 last month.

As splintering debt-ceiling negotiations unnerved analysts and ratings agencies, Treasury yields and mortgage rates remained relatively stable over the weekend, reflecting a widespread consensus among investors and market watchers that partisan divisions would soon give way to a grand bargain between policymakers. CNN reported Sunday that House Speaker John Boehner (R-Ohio) refused to agree to a set of conditions at the White House, ending dramatic four-month-long negotiations.

On Wednesday the Mortgage Bankers Association released its weekly survey, showing jumps in mortgage applications by 15.5 percent and by 23.1 percent in refinances, respectively, from the previous week. According to the survey, mortgage loan application volume went up over 15 percent on a seasonally adjusted basis, with a steady increase by 43 percent. According to the survey, mortgage loan application volume went up over 15 percent on a seasonally adjusted basis, with a steady increase by 43.9 percent on an unadjusted basis from the week earlier.

Wary of an uncertain economic climate, new regulatory legislation, and the potential for burdensome capital restrictions, the nation's top lenders financed fewer mortgage loans in 2010 than in 2009 to keep their ledgers in the black a cumulative pattern that analysts and news reports say hampers housing and, potentially, recovery in the broader economy. According to analysis conducted by The Wall Street Journal, the 10 largest mortgage lenders in the country denied 26.8 percent of loan applications last year, up from 23.5 percent in 2009.

With total U.S. debt soaring past $14 billion in May and negotiations over a controversial ceiling raise splintering at the highest levels, analysts worry that the Federal Housing Administration may shut down if the federal government defaults on August 2 -- a crisis scenario that would wreak havoc in housing markets, tightening the credit supply and spoiling a recovery. Analysts suggest that a default by the government would unfairly and adversely impact minority homeowners.

Mortgage lenders across the country have reported layoffs and substantial downsizing, a consequence of heightened regulatory scrutiny, weak job growth, and brittle markets slumbering in the wake of diminishing consumer confidence. Despite a small spurt in refinancing measures and a drop in lending rates to their lowest ebb since the turn of the century, origination loan volume remains low, and lenders are coming to terms with the fact that they will be financing fewer mortgages over a longer-than-expected period.