Falling interest rate precipitated a major refinancing rally during the week ended October 17 even though Columbus Day shortened the business weeks in some locations. The Mortgage Bankers Association’s (MBA’s) Refinance Index jumped 23 percent compared to the previous week, the largest increase for the index this year, far surpassing an 11 percent gain in January and taking the index to its highest level since November 2013. Applications for refinancing made up a 65 percent share of all applications compared to 59 percent the previous week and the average size of a loan for refinancing rose to $306,000 the highest level since MBA started its survey in 1990.
Refinance Index vs 30 Yr Fixed
“Continuing concerns about weak economic growth in Europe and a few US economic indicators that came in below expectations caused a flight to quality into US Treasuries last week, leading to sharp drops in interest rates,” said Mike Fratantoni, MBA’s Chief Economist. “Mortgage rates have fallen close to 30 basis points over the last four weeks.”
So if you’re on the fence to buy or refinance, now is the time to do it. Click here to apply or grab your free rate quot by clicking below.