Are you considering refinancing your home? Now could be the perfect time since mortgage rates last week fell to their lowest level in about a month.
The average contract interest rate for 30-year fixed-rate mortgages with conforming loan amounts of $832,750 or less dropped to 6.17
% from 6.21%, according to the Mortgage Bankers Association (MBA). The decline led more borrowers to refinance their homes to save money. Refinance applications rose by 7% this week and are 132% higher than the same week last year.“Mortgage applications rose last week as the lowest rates in four weeks helped to revive some refinance activity. Treasury yields ended the week lower as weaker data on retail sales and home sales outweighed better-than-expected readings on the job market for January,” Joel Kan, MBA’s vice president and deputy chief economist, said in a press release.
The average contract interest rate for Federal Housing Administration (FHA) 30‑year fixed‑rate mortgages dropped to 5.99% from 6.01%, while points fell to 0.65 from 0.68 for 80% of loan-to-value (LTV) loans.
However, the rate decrease didn’t impact those looking to buy a home. Overall, mortgage applications dropped 3% this week, except for VA purchases, which increased by 4%. Although lower rates didn’t motivate many potential buyers, the rise in refinances boosted mortgage demand by 2.8% compared to the previous week.
The National Homeowners Association (NAR) reports that sales of previously owned homes in January experienced a larger-than-expected 8.4% decline from December. The drop marks the largest decline since February 2022. Experts cite consumer trust in the economy and housing supply as reasons for the decline. Mortgage rates didn’t change during this short holiday week, but data
set for release later in the week may alter the current trajectory, CNBC reports. In general, however, mortgage rates have been hovering in a narrow range, between 6 and 6.25%, since the beginning of 2025.RELATED CONTENT: Conviction Upheld For Former Baltimore State’s Attorney Marilyn Mosby In Mortgage Fraud Case