Mortgage Applications Rise 3% at Start of April
The Mortgage Bankers Association has reported a 3 percent uptick in mortgage applications as of April 1. This follows a 1 percent decrease toward the end of March, mostly attributed to a steady drop in refinance applications. Still, this month’s increase brings the market barely even with typical activity, proving we’re still recovering slowly from the recession.
In an effort to increase home sales, the federal government recently took two important steps to assist first-time buyers. First was the resurgence of the 3 percent down conforming loan, and second was the incentive to complete foreclosure prevention counseling in order to receive lower mortgage insurance rates. Industry data suggests consumers are taking advantage of both programs at high rates. Recent media reports are also fueling speculation that the government plans to reduce loan level pricing adjustments on Fannie Mae loans for borrowers with low credit scores, though nothing has yet been announced.
After a relatively dismal 2014, last year showed signs of lasting improvement in both the refinance and purchase markets overall. The Mortgage Bankers Associations sees 2016 moving in a positive direction thus far, as well. Still, as interest rates continue to creep up and inventory remains low for buyers, there may be challenges ahead.
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