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By Leslie Cook
June 24, 2020

Despite historically low interest rates, mortgage applications dropped for the first time in weeks as the supply of available homes for sale remains tight and as many people have already refinanced existing home loans.

Overall mortgage loan applications fell nearly 9% for the week ending June 19, according to data released Wednesday by the Mortgage Bankers Association. Refinance applications experienced the largest decrease, dropping 12% percent week over week. Despite this drop, refinances are still 76% higher than a year ago.

“Even with high unemployment and economic uncertainty, the purchase market is strong. Activity has climbed above year-ago levels for five straight weeks and was 18% higher than a year ago last week,” said Joel Kan, head of economic and industry forecasting for the MBA.

Kan noted that the increased demand for homes is in conflict with the tight supply of new and existing homes available, which may put a damper on future sales. “Additional housing inventory is needed to give buyers more options and to keep home prices from rising too fast,” he added.

Lawrence Yun, chief economist for the National Association of Realtors, also pointed out the need for more inventory in a post on the NAR website. “New home construction needs to robustly ramp up in order to meet rising housing demand,” wrote Yun.

The sale of new single-family homes surged during the month of May, up 16.6% over April figures, and up 12.7% above the May 2019 numbers, according to data released Tuesday by the United States Census Bureau.

“The jump in new home sales is a nice indicator of what’s to come because it’s based on contract signings, a somewhat early stage of the home buying process,” noted Danielle Hale, chief economist for Realtor.com. “A similar surge in next week’s pending home sale, which covers the much larger existing homes market, will be good confirmation that the low point in home sales is likely behind us.”

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Average Mortgage Rates Today

The average interest rate for a 30-year fixed-rate mortgage dropped to 3.13% with 0.8 points paid for the week ending June 18, according to Freddie Mac. That’s 0.02 percentage points below the previous all-time low of 3.15% set May 28.

According to Freddie Mac, the average rate for a 15-year fixed-rate mortgage was 2.58% with 0.8 points paid, down 0.04 percentage points from last week, while the average rate on a 5-year adjustable-rate mortgage also decreased slightly to 3.09% with 0.4 points paid.

Average Refinance Rates Today

A year ago the average rate was 3.84%. A homeowner with a $250,000 mortgage balance paying 3.84% on a 30-year loan could cut their monthly payment from $1,170 to $1,071 by financing at today’s lower rates. (It is important to note that refinancing involves closing fees and will reset the clock on your mortgage, meaning you will have to make payments longer.)

Today’s Mortgage Rates

Of course, mortgage rates vary widely by location and personal factors like the type of property you plan to buy, the size of your down payment, and your credit score. Here are today’s advertised mortgage rates at some of the mortgage industry’s largest lenders.

Quicken

Quicken, a non-bank lender based in Detroit, is the nation’s largest mortgage lender by dollar origination volume.

Mortgage rates advertised for June 24:

30-year fixed: 3.5%

15-year-fixed: 3.088%

(Quicken doesn’t advertise a five-year adjustable rate. Rates are APRs.)

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Wells Fargo

Based in San Francisco, Wells Fargo has more than 7,000 locations.

Mortgage rates advertised for June 24:

30-year fixed: 3.228%

15-year-fixed: 2.722%

5-year ARM: 2.867%

(Rates are APRs.)

JP Morgan Chase

Based in New York, JP Morgan Chase has nearly 5,000 U.S. branches.

Mortgage rates advertised for June 24:

30-year fixed: 3.065%

15-year-fixed: 2.631%

5-year ARM: 2.834%

(Rates based on New York City zip code 10006. Rates are APRs.)

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Bottom Line:

If you have decent credit, you may be in a position to take advantage of mortgage rates near all time lows

View Money’s Best Mortgage Lenders of 2020

Compare Money’s Best Mortgage Refinance Companies of 2020

Related: Why Right Now Is the Best Time to Refinance Your Mortgage, According to David Bach

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