Not a surprise refis are way down. I'm surprised its not down 90%. Why would you be refinancing now when you didn't 6 months ago at 1.5-2% lower rates (maybe their refinancing into 7/1 ARMs?)
Posted on 04/20/2022 4:52:53 AM PDT by Browns Ultra Fan
There is one song that sums up the mortgage banking industry with proposed tightening of Fed monetary stimulypto: T-R-O-U-B-L-E.
Mortgage applications decreased 5.0 percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending April 15, 2022.
The Refinance Index decreased 8 percent from the previous week and was 68 percent lower than the same week one year ago. The seasonally adjusted Purchase Index decreased 3 percent from one week earlier. The unadjusted Purchase Index decreased 2 percent compared with the previous week and was 14 percent lower than the same week one year ago.
All together now, mortgage rates are up 76% under Biden.
And yes, The Federal Reserve STILL has its enormous foot on the monetary gas pedal (with hints that they will remove it “soon.”
The number of ARMs increased 14.9% from the previous week.
Between Bidenflation and Powell and the Gang tightening monetary policy, This One’s Gonna Hurt You (For A Long, Long Time).
(Excerpt) Read more at confoundedinterest.net ...
This is how recessions start. I don’t always agree with Sanders, but he seems to be on the right track here. I don’t think this is the Fed’s mistake as much as it is the natural consequences of Biden’s mistake with ARPA, but the slowdown is not only going to kill inflation, it’s going to also kill the economy.
This is like musical chairs. One knows exactly how the game ends when the music stops til the last person/loser is standing. Right now it is Xiden. The self-centered, bucket-list, entitled, everyone-gets-a-trophy, cell-phone addicted millenials are going into territory never lived in, and because of poor education, never learned about the laws of economics. That’s where the danger is ...
dim-0s have put us in a very bad situation. INFLATION!!! The only way to stop inflation is to raise interest rates, making spending money more expensive. HOWEVER, the national debt is tied to interest rates. IF they go up, the national debt SKYROCKETS without even being able to spend the money!
As I understand it, INTEREST is the biggest part of national debt. IF interest rates double, so does the debt.
We’re SCREWED.
If you have a mortgage and a house already, and you don’t plan on squeezing equity for a HELOC, then this won’t affect you directly.
When we got the Volcker medicine the national debt was less than $1T. Today we are raising the debt $1T a month! 30 times as painful, interest wise, today.
https://www.nytimes.com/2022/03/14/business/economy/powell-fed-inflation-volcker.html
Most of the debt is at fixed rates of interest that do not change until the bonds mature and are reissued at new interest rates. The current bout of inflation is expected to be of relatively short duration since the Fed is finally starting to act. A recession will kill the inflation, and remove the need for further high rates. In fact the Fed might reduce rates if the recession lasts longer than a couple of quarters.
Interest rates are rising, so loan apps are falling. No mystery there.
Not a surprise refis are way down. I'm surprised its not down 90%. Why would you be refinancing now when you didn't 6 months ago at 1.5-2% lower rates (maybe their refinancing into 7/1 ARMs?)
I miss Hydroshock
This is true. In Atlanta inventory is very low. Homes in our neighborhood sell in one day and currently not one house for sale. We expect to sell ours soon in a bidding war. And as a long time mortgage broker I can attest that as fixed rates rise people just switch to ARMs. I see ARMs are up 14.9%. Not surprising.
If banks can't find borrowers they believe will pay them back then it doesn't matter what the interest rate is.
I wonder if you eliminated all the houses being bought in Red States what the statistics would be, my gut feeling is the statistics would go sky high, OMG jump out the window the world is coming to an end. I live in the out of control growth area of Middle Tennessee and I’ve been shaking my head at the growth in this area the last couple of decades, but it been in the last couple years where the growth has really gotten out of hand. But I’m seeing a slight slow down of houses being built, and most of those being built are people who have sold their houses in Blue States like California and are taking their profits and buying new houses in Red States. I’m seeing less and less houses being built now and more and more Townhouses being built. My gut feeling is even the building of Townhouses are going to start slowing down, and then we got something to really worry about.
Yes, it is. We’re not going to end this inflation without some sort of a recession.
Can’t be done.
And to add to the last comment I made, my gut feeling is most of the loans being given out are to minorities that our government is twisting the arms of the banking establishment to give out the loans, and or our government is giving them these houses for pretty much free. We are no longer a true capitalistic country.
Back in the 1970’s, a 7% mortgage rate was considered a bargain.
Yup - can still get 3.19% on a 5/1 Smart ARM from Third Federal at the moment (if they are in your state) with no points or 3.49% and they pay all the closing cost by $249
Doesn’t the US govt finance its debt at fixed rates? Or a large portion of it? Why would rising rates increase payments?
You are 100% right. millennials won’t understand it and thus will just blame “capitalism!!!”
MANY, MANY people finance with adjustable mortgages it is easier to qualify!!
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