March 14, 2019
Refinance Rates on the Rise
The latest Federal Housing Finance Agency (FHFA) Refinance Report reveals that, in concordance with the rise of interest rates in the mortgage industry in general, the interest rates for refinances also continued to rise toward the end of last year. In September, for example, the average rate on a 30-year fixed mortgage was 4.63 percent, while by October that rate rose to 4.83 percent.
But the rise in rates does not just refer to the interest rates paid—the number of refinances overall also increased during that period, after having gone through a general decrease through most of 2018—and at one point even reached their lowest rate of initiation in 18 years. So yes, the numbers increased—but that may have been something of an anomaly; they still remain historically low, and the ongoing rise of interest rates shows no sign of abating just yet, which means it grows steadily less likely that people will be able to consider a refinance a positive step toward making their home payments more affordable, given the historically low rates we have seen in the years since the 2008 crisis.
The Refinance Report focuses in on HARP refinances—which account for only one percent of the nation’s refinances. Six percent of loans refinanced through HARP during this period had a loan-to-value ratio exceeding 125 percent, and about 16 percent of the loans had a loan-to-ratio value exceeding 105 percent. The FHFA determined that for those who were HARP eligible but did not refinance using a HARP loan, delinquency was more likely to occur than for those who did take advantage of the HARP program.
Among the states (and one territory—Puerto Rico) with a higher-than-average percentage of HARP eligible loans, we find Topouzis & Associates, P.C.’s service area of Florida, where HARP refinances made up two percent of total refinances, as compared to the national average of one percent.
Whether you’re shopping around for title insurance in Florida, or in our other service area states of Rhode Island or Massachusetts, contact us to see how we can help. Topouzis & Associates, P.C., is backed by multiple underwriters, staffed by residential real estate specialists and ready to help you avoid costly delays and streamline your residential transactions.