Rising mortgage rates yield fewer loan applications
Posted on Thursday, June 6, 2013 at 11:04:01 AM
As lending conditions repeatedly showed signs of strengthening in recent weeks, more consumers have exhibited a considerable amount of hesitation in their pursuit of residential financing.
According to Freddie Mac's latest Primary Mortgage Market Survey, fixed-rate mortgages were again seen ticking higher during the period ending June 6, which marked the fifth consecutive week of gains. Average 30-year FRMs moved up to 3.91 from 3.81 percent last week, while 15-year FRMs rose from 2.98 to 3.03 percent.
Freddie Mac vice president and chief economist Frank Nothaft said discussions by industry regulators may have caused the hike in rates, among other economic indicators.
"Continuing market concerns that the Federal Reserve may slow its bond purchases amid a strengthening economy added upward pressure on mortgage rates this week," said Nothaft.
Meanwhile, the recent appreciation in rate averages again caused fewer consumers to submit applications for home loans. A decline of 11.5 percent was observed in the Mortgage Bankers Association's Weekly Mortgage Applications Survey for the week ending May 31.
However, just because interest rates aren't as low as they previously were doesn't mean conditions don't still largely favor individuals seeking residential lending. Those looking for financial assistance can benefit from researching the multitude of products and services offered by the trusted lender Home Loan Investment Bank.