Mortgage rates in the U.S. declined, remaining at a 16-month low as more affordable borrowing costs fuel an increase in refinancing.
The average rate for a 30-year fixed mortgage was 3.92 percent, down from 3.97 percent last week, Freddie Mac said in a statement today. The average 15-year rate dropped to 3.08 percent from 3.18 percent, the McLean, Virginia-based mortgage-finance company said.
Homeowners are rushing to cut their monthly payments as rates hover at the lowest levels since June 2013. Refinancing applications jumped 23 percent in
the week ended Oct. 17 to an 11-month high, the Mortgage Bankers Association said yesterday. The refinance share rose to 65 percent of home-loan applications from 59 percent.
“The dip in rates here are for people who were looking at the numbers throughout the summer and saying, ‘It’s pretty close,’” Keith Gumbinger, vice president of HSH.com, a Riverdale, New Jersey-based mortgage-data company, said in a telephone interview. “And now you have a place where that refinance might make sense.”
While lower rates won’t give an immediate boost to housing demand because of the time it takes to select and complete the purchase of a property, sales have been improving. Purchases of previously owned U.S. homes increased 2.4 percent in September to a 5.17 million annual rate, the highest level in a year, the National Association of Realtors said this week.
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