Mortgage demand experienced a slight decrease last week, due in large part to higher interest rates caused by the tumultuous debt ceiling debate and resilient inflation. This decline comes in contrast to the two weeks prior where US mortgage applications saw a sizeable increase.

In an environment of slowly rising rates, potential homebuyers might be encouraged to close their loans sooner as market rates will continue to increase with the recovering economy. Further, despite the initial, unexpected jump in rates, the overall picture of rates is decreasing, creating an environment of opportunity for home buyers and refinancing borrowers.

The Most Important Elements:
• Higher interest rates caused by debt ceiling debate and inflation: Decreased mortgage demand.
• Initial, unexpected jump in rates: Market rates increasing with improving economy
• Overall picture of rates decreasing: Opportunity for home buyers and refinancing borrowers.

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