Mortgage Refinancing Suddenly Surges, But Homebuyers Stall Due To Sticker Shock

Mortgage rates fell for the first time in nearly a month, and that lit a fire under current borrowers who may have thought they missed the boat on refinancing their loans.

Applications to refinance jumped 11% last week from the previous week, according to the Mortgage Bankers Association’s seasonally adjusted index. Demand was 59% higher than a year ago. The refinance share of mortgage activity increased to 71.4% of total applications from 70.7% the previous week.

The move was spurred by a decline in interest rates. The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($548,250 or less) decreased to 2.92% from 2.95%. Points were unchanged at 0.32 for loans with a 20% down payment.

-CNBC