Tag Archives: Refinance

Independent mortgage banks and their subsidiaries made an average profit of $1,423 on each loan they originated in the third quarter, thanks to a surge in refinance activity and growing demand for mortgage-backed securities, the Mortgage Bankers Association (MBA) reported Tuesday. The third quarter's per-loan profit represents a jump of more than 55 percent from the $917 independent mortgage lenders made on each loan in the second quarter of this year.

Mortgage interest rates rose again this week, marking the fourth consecutive increase. Freddie Mac says the average rate on a 30-year fixed mortgage has jumped to 4.61 percent, up from 4.46 percent just one week earlier. If such sharp increments continue at this pace, the 30-year rate could rise above where it was a full year ago (4.81 percent) in a matter of mere weeks. For a $200,000 conventional loan, the sudden rise amounts to $50 more in monthly payments than if buyers had locked in rates just two months ago.

Industry data released Wednesday shows that new mortgage applications for the purchase of a home jumped 1.8 percent for the week ending December 3. This is the third weekly increase recorded by the closely watched home purchase index, which has reached its highest level since early May. All market indicators point to a continued rise in mortgage rates and that seems to have prompted some homebuyers to act now. Refinancing, on the other hand, is becoming less attractive.

The Mortgage Bankers Association (MBA) reported Wednesday that mortgage applications for refinancing dropped 21.6 percent for the week ending November 26, as interest rates continued to head upward. It marked the third weekly decrease for the refinance index, which has hit its lowest level since June 2010. MBA's measurement of loan applications for home purchases rose 1.1 percent from one week earlier and, in contrast, is at its highest level since the beginning of May 2010.

Mortgage applications for home purchases jumped during the third week of November to their highest level since May. The Mortgage Bankers Association (MBA) reported Wednesday that its index of purchase applications soared 14.4 percent for the week ending November 19th. MBA says the increase suggests growing consumer confidence. It offset a 1.0 percent decline in applications for mortgage refinancing, which in contrast, hit their lowest mark since the end of June.

Sales at Titleserv National, a provider of title insurance, appraisal, and settlement services for residential and commercial customers, increased by almost 43 percent from the second to third quarters of 2010, according to a statement from the company. The third-quarter increase also represents a 34 percent gain over the same period in 2009. The New York-based company attributes the jump to lower interest rates, which boosted demand for refinancing, and a major expansion of its sales force.

Fewer than 500,000 homeowners have received permanent assistance through the Home Affordable Modification Program (HAMP) and are still current on their new payments. During the month of October, only 23,750 permanent modifications were granted. Many have called HAMP's results disappointing, but administration officials assert that the full spectrum of housing policies have helped bring stability to a very challenging housing market.

Mortgage fraud has increased by more than 20 percent since fraud rates reached their lowest point in early 2009, according to CoreLogic. The company says higher risk, high-volume programs, including those offered by the Federal Housing Administration and the Treasury's Home Affordable Refinance Program, as well as REO and short sales accounted for much of the increase. All are areas where activity has risen sharply over short periods of time, or where safeguards are not squarely in place, CoreLogic says.

Consumer demand for home loans plummeted last week as mortgage rates shot up against the backdrop of the Federal Reserve's announcement to pump more money into the economy - an initiative that's designed to keep interest rates low. The total volume of new mortgage applications sank 14.4 percent. It's the biggest week-to-week drop of 2010 and the lowest reading in four months. Rates for 30-year fixed mortgages rose 18 basis points during the one-week period, but analysts say it's too soon to conclude the Fed got it wrong.

Fixed-rate mortgages have become the dominant choice among borrowers looking to refinance their home loans, with more applicants gravitating toward shorter loan terms. A study by Freddie Mac on loan transition trends found that in the third quarter, more than 95 percent of homeowners who refinanced chose fixed-rate loans, regardless of whether their original loan was an adjustable- or fixed-rate mortgage. Borrowers who previously held shorter-term mortgages also showed a stronger preference for staying with a 15-year or 20-year loan.