Since the beginning of the year, refinance activity has been on a steady decline. But, according to Ellie Mae’s Origination Insight Report, refinance activity reached a six-month high in October. Compared to the previous month, October refinance activity increased by 4% with refinances making up 40% of all closed mortgage loans. The last time refinance activity made up that much of the share of all mortgage loan volume was in March 2014.
For the sixth-consecutive month, 30-year mortgage interest rates continued to declined, reaching 4.371 in October. This is the lowest average rate since July 2013. In response to Ellie Mae’s report, National Mortgage Professional Magazine President and Chief Operating Officer, Jonathan Corr, attributed the refinance volume increase to consumers taking advantage of the lower interest rates and compared the nature of refinance activity in relationship to interest rates to a seesaw.
Corr stated, “We will see this little jump in activity if rates go below a certain threshold. If rates go up, we will see the refi level stay.” As interest rates are expected to gradually rise over the coming months, Corr said he did not anticipate seeing continued refinance activity increases going forward. http://bit.ly/1APBsxI