With mortgage rates falling to their lowest levels in eight months, some Capital Region residents are seizing their opportunity to refinance on their homes.
The average rate for a 30-year fixed mortgage recently dropped to 4.51%, according to mortgage finance enterprise Freddie Mac, falling from a more than seven-year high of nearly 5% last fall. It’s giving residents a chance to fetch lower rates on loans.
Assurance Financial owner Kenny Hodges says Monday was one of his company’s best interest lock days in its history, locking 38 mortgages across the country that were collectively worth $10 million—more than double a usual $4 million lock day for the mortgage lender. Most of Monday’s activity involved clients refinancing, he says, though some also included clients purchasing new homes.
“It’s the time of year when people set financial goals about how to take advantage of their equity in a house, and right now is great timing to do that,” Hodges says.
Anthony Williams, president of the Greater Baton Rouge Mortgage Lenders Association, says pre-approval applications and production should be on the rise industry-wide. He’s seen the trend play out at Eustis Mortgage in Prairieville, where he serves as vice-president-branch retail sales manager.
“Typically the rule is a one percent reduction before it becomes a true refinance market,” Williams says, “We’re right on the cusp of seeing that. But when rates drop a half-percent in two months, that’s when folks start jumping.”
Despite recent drops in mortgage applications over the past few months (some of it because of the government shutdown), people are also showing more interest than usual in purchasing homes during the typically slow winter season, the lenders say, though there’s no telling whether it’s translating to sales yet. The Greater Baton Rouge Association of Realtors will receive those figures next month.