As mortgage rates continue to be extremely low, the latest Mortgage Bankers Association weekly survey saw mortgage application volume jump 2.4% for the week ending on August 21, 2020. Refinance applications, specifically, grew 4% from the previous week and are up 143% from the same period last year, according to the MBA.

Joel Kan, an MBA associate vice president of economic and industry forecasting, said that the mortgage industry has been running hot recently, as mortgage rates are much lower following the Fed’s recent rate cut. Kan added that lower mortgage rates are encouraging more homeowners to refinance and said that this is a trend that could continue for some time and could help the housing market’s recovery going forward.

The average rate for a 30-year fixed-rate mortgage was 3.12%, a decrease from 3.14% the week before, and 0.76 percentage points lower compared to the same date one year ago. The 15-year fixed-rate also decreased, from 2.68% to 2.60% over the same period.

The purchase mortgage application volume increased 4% over the past week and is 10%, year-over-year, higher than the corresponding period in 2019. As the pace of homebuying accelerates, Kan said that it might be difficult to sustain the high application numbers going forward. However, the dour outlook could potentially change if mortgage rates remain this low and can help buoy the housing market through the remainder of 2020 and beyond.

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