Home refinancing mortgage applications rose in the US, for the first time in over a month as homeowners try to reap the benefits of lowered interest rates.
The Mortgage Bankers Association
today released the data which showed the jump in refinancing loan applications
said that its seasonally adjusted mortgage application index, inclusive of
purchase as well as refinance loans, rose by 14.6 percent. The same index
specifically for refinancing loans rose 21 percent, reaching levels not seen
since August 27. Their four-week ongoing average for mortgage figures had
increased by 3 percent.
Increases in home loan refinancing could be a sign of increased consumer spending, as a lower monthly mortgage bill will enable more ready cash to be spent elsewhere. It may also help some struggling homeowners avoid defaulting on their loans, or going into foreclosure proceedings.
Alan Rosenbaum, president of New York-based
mortgage firm Guardhill Financial said that refinancing has gained
strength as rates dropped, but that strict lending standards may be stopping
people from fully taking advantage of the low interest rates.
"The government states that they want to keep rates low so that homeowners will buy and refinance to spur the economy, but they continue to keep underwriting guidelines too strict for most Americans to qualify for a mortgage," he said, further adding that it is possible that many are waiting until after the November elections, so that issues about tax and regulations will be clearer, and give people the confidence to make important financial sdecision.
