Florida Mortgage Rates Rise … Along with Application Rates

Despite high interest rates, consumers weren’t afraid to refinance home loans last week, according to the Mortgage Bankers Association. Its index of total mortgage applications for purchasing new homes and refinancing already-existing loans rose 1.5% during the week that ended September 16. The previous seven days had actually seen a 1.4% dip in the index.

In related to news, fixed 30-year mortgage rates rose nine base points (i.e. .09%), to an overall average of 5.81%. If you exclude fees, this number compares with 5.72% from the prior week. Always considered to be symbolic of the industry, this specific type of mortgage rate is still below the high in 2005 of 6.08%, which was reached in March. In June, the number was at its year low, 5.47%.

Here is the latest updates on other types of loans from last week:

• Fixed 15-year mortgage rates averaged 5.38% (an increase from 5.29% the week before)
• One-year adjustable-rate mortgages (ARMs) rose to 4.94% (from a previous rate of 4.82%)
• As a percentage across the board of mortgage applications, refinancings also increased to 45.6% (from 42.9%), the MBA said.

Under the terms of ARMs, low initial payments allow borrowers to buy homes they may not be able to afford with another package, such as a fixed-rate loan. Because fixed mortgage interest rates rose in recent weeks, demand for ARMs also climbed. They accounted for 29.8% of total applications, up from 28.2% the previous week.