Relatively low lending rates coupled with still-stringent lending requirements have created a “quiet” mortgage market, but mortgage rates have jumped slightly over the sluggishness of last week, according to some industry sources.
The Mortgage Bankers Association, an industry group, indicated that for the week ending October 14th, mortgages were down just under 15% over the prior week despite low interest rates. During that week, refinancing applications were down 16.6 percent, and loan requests for home purchases fell 8.8 percent.
Low consumer confidence and high unemployment have been cited as reasons for a continually sluggish mortgage market, but in a press release, a spokesman from online mortgage service Zillow cited fluctuations in global markets as another reason mortgage rates don’t seem to be stimulating the market sufficiently:
Erin Lantz, director of Zillow Mortgage Marketplace, predicted rates wouldn’t hold so steady for long, saying a European Union summit over the weekend would likely move markets… Lately, worries about European debt pressured yields on U.S. Treasury bonds. Mortgage rates tend to follow the yields. Many mortgage trackers have reported mortgage rates at or near historic lows recently, giving the rates little room to fall more.
Keith Gumbinger, vice president of HSH.com also commented in a press release about mortgage rates and economic challenges:
“Economic news continues to brighten, pushing mortgage rates upward somewhat. But despite the increase this week, there are few reasons for rates to continue to climb… There should be ample opportunity for mortgage rates to ease again. The cumulative rate increase in recent weeks has been barely an eighth of a percentage point, so it’s not enough to warrant much concern.”
