The demand for mortgage refinancing increased by 27% as interest rates decreased for the third consecutive week.

• The interest rate for 30-year fixed-rate mortgages with conforming loan balances decreased from 6.69% to 6.67%.
• The number of applications to refinance a home loan increased by 27% from the previous week and was 42% higher compared to the same week last year.
• The number of mortgage applications for purchasing a home decreased by 4% in the current week, but was 4% higher compared to the same week last year.

Last week, mortgage rates decreased, prompting current homeowners to search for savings. A 5.4% increase in total mortgage demand was due to the surge in refinances, as reported by the Mortgage Bankers Association's seasonally adjusted index.

The interest rate for 30-year fixed-rate mortgages with conforming loan balances decreased to 6.67% from 6.69%, with points falling to 0.66 from 0.67 (including the origination fee) for loans with a 20% down payment.

The number of applications to refinance a home loan increased by 27% from the previous week and was 42% higher than the same week a year ago. Despite the large percentages, the base volume is still relatively low. Many borrowers currently have mortgages with rates lower than what is currently being offered. From 2020 to the first half of 2022, rates were below 4%. Last week's mortgage rates were 40 basis points lower than they were the same week a year ago.

The percentage of mortgage applications that involved refinancing rose to 46.8% from 38.7% the week before.

The number of mortgage applications to purchase a home decreased by 4% during the week, but was still 4% higher than the same week a year ago. Homebuyer demand had been increasing recently as more properties became available.

Despite a slight decline in one week, purchase applications have exhibited consistent growth over the past three months, with Joel Kan, an MBA economist, citing sustained housing demand and gradually increasing inventory as factors supporting this trend in a release.

According to Mortgage News Daily, mortgage rates increased by 10 basis points at the beginning of the week, reversing much of the decline seen in the previous week. However, the direction of mortgage rates on Wednesday could change with the release of the monthly consumer price index, which measures inflation.

"According to Matthew Graham, chief operating officer at Mortgage News Daily, Wednesday morning's CPI data is the final significant piece of information the Fed will receive before deciding whether to cut or not to cut next week. The market is aware of this, so a significant deviation from forecasts would be enough to trigger movement."