Mortgage Rates Drop Again, But May Soon Reverse Course

Record low mortgage rates have had a good run, but it may be coming to an end, CNBC says. Last week looked good for mortgage rates, which dropped from 3.14% to 3.06% on 30-year fixed-rate mortgages with conforming loan balances of $510,400 or less. Mortgage application volume began a slight downturn in previous weeks but rose 6.8% last week. In addition, mortgage applications to refinance a home loan and applications to purchase a home both grew. But COO of Mortgage News Daily warns that these low rates came off of a sharp rise on Tuesday due to a sell-off in the bond market, and that jump should serve as a cautionary tale.

“Mortgage rates fell across the board last week, as investors grew less optimistic of the economic rebound given the resurgence of virus cases. Loan types such as the 30-year fixed, 15-year fixed, and jumbo all reached survey lows,” said Joel Kan, an MBA economist.

Mortgage applications to refinance a home loan, which are most rate sensitive, jumped 9% for the week and were 47% higher than the same week one year ago. The annual comparison, while still strong, has been shrinking dramatically over the last several weeks.

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