Refinance applications spike 20% as homeowners rush to get low rates
January 13, 2021 at 17:44
In the past 12 months, mortgage rates fell to new record lows more than 15 times.
But with an expectation that rates may soon begin ticking up, homeowners are racing to refinance.
Refinance applications rose 20% for the week ending January 8 compared to the prior week, according to the Mortgage Bankers Association's seasonally adjusted index.
That's 93% higher than a year ago and the highest rate since March.
Both conventional and government refinance applications were up, with applications for government loans having their biggest week since June 2012.
"Booming refinance activity in the first full week of 2021 caused mortgage applications to surge to their highest level since March 2020, despite most mortgage rates in the survey rising last week," said Joel Kan, MBA's associate vice president of economic and industry forecasting.
In MBA's survey of interest rates last week, the 30-year fixed mortgage rate climbed two basis points to 2.88%.
But the 15-year fixed rate ticked down to 2.39% -- a record low.