Florida Home Loan Applications Rise as Rates Fall

Florida mortgage applications rose for a second straight week as benchmark interest rates on home loans tumbled to their lowest since May.

The Mortgage Bankers Association said that, in its seasonally adjusted index of mortgage applications for the week ending September 7, that Florida home loan demand increased 5.5 percent.

How much of this rise is artificial - people filling out more and more Florida mortgage applications because they can’t get approved - is unclear.

Borrowing costs on 30-year fixed-rate Florida mortgages, excluding origination fees, averaged 6.25 percent, down 0.17 percent from the previous week, their lowest since the week ending May 18.

At that time, they stood at 6.23 percent.

Yields on benchmark 10-year U.S. Treasury notes, linked closely to America’s mortgage rates, dropped substantially in the past week due to raised expectations of a rate cut from the Federal Reserve.

The next Fed policy-making meeting is scheduled for September 18.

The MBA’s seasonally adjusted purchase index rose 5.2 percent to 448.0. The purchase index is considered a timely gauge of home sales.

At the same time, the group’s seasonally adjusted index of Florida mortgage refinancing applications increased 6 percent.

SOURCE: Reuters