According to The Mortgage Bankers Association, a 7.5-percent increase in home loan demand during the week ending Aug. 29, 2008. They indicate a 10.5-percent jump in purchase applications and a more modest 2.1-percent rise in refinancing requests.
What is really not surprising is that The Mortgage Bankers Association index tracking mortgages backed by the FHA gained almost 20 percent. Refinances made up 34 percent of application volume and ARMs or adjustable rate loans accounted for 6.6 percent.
The good news for anyone buying, selling, or refinancing right now, Freddie Mac in their weekly survey found a drop in the 30-year fixed mortgage rate to 6.35 percent from 6.46 percent this time last year. There was also a decrease in the one-year Treasury Index Arm to 5.15 percent from 5.74 percent on this date a year ago, while the 15-year fixed rate dropped to 5.90 percent from 6.15 percent at this time last year.
“Mortgage rates eased a bit over the holiday-shortened week following release of economic data that suggest consumer spending may slow,” said Frank Nothaft, Freddie Mac vice president and chief economist. “The economy grew at an upwardly revised 3.3 percent pace in the second quarter, boosted by the smallest trade deficit in eight years, and residential fixed investment slowed growth by 0.6 percent, the least amount since the same period a year ago.
“However, personal income fell 0.7 percent in July, the first decline since August 2005 and will likely slow consumer spending in the third quarter.”
