Industry News

Rising rates cut into real estate refinancings

Borrowing costs reach highest level in 4 years

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Overall mortgage applications dipped 0.8 percent last week on a seasonally adjusted basis from the week before, with refinancings taking the biggest hit, the Mortgage Bankers Association reported today. The seasonally adjusted purchase index increased by 0.1 percent to 414.8 from 414.6 the previous week, while the refinance index decreased by 2.2 percent to 1,466.1 from 1,499.4 one week earlier. The refinance share of mortgage activity decreased to 35.5 percent of total applications from 35.7 percent the previous week. The adjustable-rate mortgage share of activity decreased to 29.6 percent of total applications from 30.7 percent the previous week. The average contract interest rate for 30-year fixed-rate mortgages increased to 6.73 percent from 6.61 percent, with points including the origination fee increasing to 1.14 from 1.13 for 80 percent loan-to-value ratio loans. This is the highest reported 30-year average rate since May 10, 2002. Points, which are fees charged by lenders f...