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31 Oct 12 Rates Creep Higher and Loan Activity Stalling

Recent reports suggest that home financing activity is slowing down. Interest rates on home mortgages remains extremely affordable but rates have been inching higher in recent weeks. The Mortgage Bankers Association said its seasonally adjusted index of real estate loan application activity, which includes both home refinance and purchase demand, dipped 4.8% in the week ended October 26. The MBA’s seasonally adjusted index of house refinance applications dropped 6%, while the gauge of loan requests for house buying, a leading indicator of home sales, edged up 0.5%. According to the website,, “Refinancing with bad credit scores has been more strenuous for borrowers with today’s increased loan standards.”

Will Interest Rates Come Back to Record Levels?

The refinance share of total residential lending activity slipped to 80% of applications from 81%. Fixed rates on 30-year loans averaged 3.65% in the week. This indicated a rise of 2 basis points from 3.63% the week before. According to MBA the weekly survey covers over 75% of mortgage applications in all 50 states.


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