WOW- normally when something moves 14% you get real excited. Not this time, because the 14% is DOWN and the item moving is mortgage applications. So I guess the answer to last week’s question re is 4.19% really that bad- has been answered. Or has it really?
Mortage applications fell, week over week, by 14.9% and Refinance applications by 16.6%. The refinance piece makes sense, in a way, because if you know you could of got it at 3.9% last week- and now the rate jumped and you are not covering the spread any longer- well then you sit and wait and see. But new mortgage applications, that is much more complex. Ask anyone who bought a home in years gone by- with rates at 8%, 9% or dare I say 10,11,12..15,16,17%….Do you know the dance they would of done to get a 4.19% rate!!!??? From 1979-1989 those were actual rates, so perspective is everything and really- if home ownership is what you want and where you want to be- then truly 4.19% is a great deal!
Now the news- time is money and since beginning this post rates have again moved- the average contract interest rate for the 30-year, FRM backed by the FHA increased to 4.12% from 4.06%, while the 15-year, FRM increased to 3.61% from 3.53%.