Purchase loan apps jump, as delayed taper suggests 'at least one month of lower rates'

Applications for purchase loans last week hit their highest level since July, the Mortgage Bankers Association reported.

The drop followed on the heels of a Fed announcement that it would not begin to taper its bond-buying program, which has kept interest rates low.

“The delayed taper just bought us at least one month of lower rates,” Trulia Chief Economist Jed Kolko tweeted to Inman News. “Those who can rush their mortgage apps will, (especially) refis.”

Purchase loan applications rose a seasonally adjusted 7 percent for the week ending Sept. 20 compared to a week earlier, and were up 7 percent on an annual basis, according to the latest Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications survey.

During the same period, refinance applications rose 5 percent.

The uptick in mortgage applications came as the average rate on a 30-year fixed-rate mortgage with a balance of $417,500 or less decreased to 4.62 percent from 4.75 percent a week earlier — a drop analysts would attribute to the Fed’s decision to hold off on winding down its stimulus program.