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By Leslie Cook
August 10, 2020

Bidding wars remained common during the month of July as homebuyers took advantage of record-low interest rates and sellers benefited from a shortage of inventory.

According to real estate brokerage Redfin, 54% of the company’s offers were involved in bidding wars in July, down a touch from 56% in June. Single-family homes were most likely to be involved in bidding wars, according to the report, as were homes in the $400,000 to $500,000 range. If a home receives at least one competing bid, Redfin considers it to be part of a bidding war.

“Bidding wars may slow down if interest rates tick up again, which could happen if we get good news about a coronavirus vaccine or more clarity around the outcome of the upcoming U.S. Presidential election,” said Daryl Fairweather, Redfin chief economist. “If coronavirus cases continue to climb, more employers will likely make flexible remote work policies standard procedure, which will drive further migration out of large, expensive cities. As a result, we may see bidding wars gain more traction in suburban areas and small towns.”

Salt Lake City saw the most competition for homes with 75% of Redfin offers facing competition, followed by San Francisco/San Jose with 67%, and San Diego with 65%.

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What are people paying for mortgages right now?

Borrowers with 700 credit scores were charged an average of 3.583% to secure a 30-year fixed-rate purchase mortgage on Thursday, according to Money’s survey of over 8,000 mortgage lenders across the country. The average rate for a 30-year refinance was 4.42%.

Average Refinance Rates Today

A homeowner with excellent credit who qualifies for the lowest rates as reported by Freddie Mac can save a significant amount of money when refinancing. A year ago the average mortgage rate was 3.60%. A homeowner with a $250,000 mortgage balance paying 3.60% on a 30-year loan could cut their monthly payment from $1,137 to $1,038 by financing at today’s lower rates. (It is important to consider closing fees and that refinancing could reset the clock on your mortgage, meaning you will have to make payments longer.)

What should house hunters be watching next?

On Monday afternoon, the Mortgage Bankers Association will release its latest survey of mortgage loans in forbearance. The number of loans in deferment plans has been steadily declining from a high of 4.3 million in April to an estimated 3.8 million the week ending July 26.

What should you expect when selling a home?

Tampa Redfin real estate agent Brian Walsh on the current seller’s market:

For more on the bidding wars in the real estate market, read: Bidding Wars are Back. Here’s How to Win Your Dream Home.

What are today’s advertised rates?

Of course, mortgage rates vary widely by location and personal factors like 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. (All rates are APRs. The rates you see may be different.)

JP Morgan Chase

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

Mortgage rates advertised for August 10:

30-year fixed: 2.835%

15-year-fixed: 2.494%

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

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Wells Fargo

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

Mortgage rates advertised for August 10:

30-year fixed: 2.996%

15-year-fixed: 2.720%

5-year ARM: 2.861%

Quicken

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

Mortgage rates advertised for August 10:

30-year fixed: 3.236%

15-year-fixed: 2.924%

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Bottom Line:

How to Get Preapproved for a Mortgage: A Step-by-Step Guide for Homebuyers

Everything You Need to Know About Mortgage Rates in 2020

Mortgage Rates Are at Record Lows. But What Does It Take to Actually Qualify for a 3% Loan?

Advertiser Disclosure

The purpose of this disclosure is to explain how we make money without charging you for our content.

Our mission is to help people at any stage of life make smart financial decisions through research, reporting, reviews, recommendations, and tools.

Earning your trust is essential to our success, and we believe transparency is critical to creating that trust. To that end, you should know that many or all of the companies featured here are partners who advertise with us.

Our content is free because our partners pay us a referral fee if you click on links or call any of the phone numbers on our site. If you choose to interact with the content on our site, we will likely receive compensation. If you don't, we will not be compensated. Ultimately the choice is yours.

Opinions are our own and our editors and staff writers are instructed to maintain editorial integrity, but compensation along with in-depth research will determine where, how, and in what order they appear on the page.

To find out more about our editorial process and how we make money, click here.

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