MBA cites the Federal Reserve’s bailout of Fannie and Freddie for plummeting rates, with refinancing leading the way. Mortgage loan applications increased significantly last week, a mortgage bankers’ group said Wednesday, as government bailouts led to sinking interest rates that made mortgage refinancing especially more attractive.
According to Kelly Media Group president, Jason Cardiff, “Clearly lower mortgage rates are good for starving brokers and ultimately, low interest rates will help revive the economy. Cardiff continued, “The important thing to note is that the Fed and the mortgage lenders are making changes, something they have not been doing enough of.”
Conforming mortgage rates have been the primary benefactor of the Federal Reserve’s influence. The average for a conforming 30-year fixed rate mortgage slipped to a weekly average of 5.57%, down considerably from an October 15 recent peak of 6.75%, and well below the 6.06% seen on the date of the announcement. As well, the 10-day string of rates below 6% represents the longest such string since February. Read the complete article > Mortgage Loan Application Activity Surges.
