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High and low: Home refinancing spikes as mortgage rates drop below 4%

The number of refinancing loans climbed 37 percent last week

The drop triggered a 37 percent increase from the week before on home refinancings (Credit: Getty Images)
The drop triggered a 37 percent increase from the week before on home refinancings (Credit: Getty Images)

Mortgage rates have fallen again, and homeowners are jumping aboard the refinancing train.

For home loans of $484,000 or less, the 30-year fixed-rate average dropped to 3.93 percent, according to CNN, citing the Mortgage Bankers Association. On bigger mortgages and on 15-year loans, rates were even lower.

The drop triggered a 37 percent increase from the week before on home refinancings; it was almost triple the amount compared to one year ago.

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But the shift didn’t cause much of a jump in home purchases, with home-buying loans only slightly up in June from the previous month. The number of existing-home sales in June was down compared to May and year over year, according to CNN, citing the National Association of Realtors.

Mortgage rates have steadily fallen throughout the year. In early June, after falling for six consecutive weeks, mortgage rates hit their lowest point since September 2017.

Meanwhile, home mortgage debt climbed to a new high in the second quarter, the Federal Reserve Bank reported Tuesday, surpassing the pre-recession 2008 peak. Last month’s Federal Reserve rate cut — its first since 2008 — could spur an increase in the overall supply of single-family homes nationwide, according to some real estate developers and experts. [CNN] — Sylvia Varnham O’Regan

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