Mortgage Rates Fall Back After Spike

By Kara Johnson,

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Mortgage rates eased back last week, after spiking sharply the week before, but the lower rates failed to stir much interest among consumers, as mortgage applications fell for the fourth consecutive week.

Average interest rates on 30-year fixed-rate mortgages fell to 4.55 percent, down from 4.69 percent previously, and giving up more than half of the increase they posted the week before. Rates on 15-year fixed-rate loans fell to 3.68 percent, down from 3.79 percent the week before and giving up most of the previous week's increase.


The drop in rates didn't generate much interest among consumers, as overall mortgage applications fell a seasonally adjusted 5.1 percent for the week, their fourth weekly decline. On average, mortgage applications have fallen 4.7 percent a week over the past month.


Refinance applications, which typically are responsive to sharp changes in interest rates, were down 6.2 percent for the week, even with an adjustment for the July 4 holiday. Refinance applications have fallen by an average of 6.3 percent a week over the past four weeks, despite mortgage interest rates remaining near historic lows.


Applications for mortgages to buy a home were down a seasonally adjusted 2.6 percent for the week, including an adjustment for the holiday, and are down an average of 1.0 percent over the past month. Purchase applications currently make up slightly more than one-third of mortgage activity, with refinance applications making up the rest.


Interest rates are based on mortgages with an 80 percent loan-to-value ratio. All figures are for the week ending Friday, July 8.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

This article appears in: Personal Finance Banking and Loans
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