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Even as 30-year fixed-rate mortgages reached their highest level in months at 7.13%, mortgage loan applications increased by 3.3% for the week ending April 12, according to data from the Mortgage Bankers Association (MBA). The vice president of the MBA, Joel Kan, explained that despite the rise in rates, borrowers were still eager to apply for loans, possibly to secure a mortgage before rates climbed even higher.
The strong economy and persistent inflation were factors motivating homebuyers to act quickly. The majority of the increase in application volume came from purchases, which are still below last year’s levels by 10%. Refinancing applications also saw a slight uptick during this period.
Federal Reserve officials are considering keeping interest rates elevated for a longer period due to the stubborn inflation rates. Despite this, homebuyers were undeterred and continued to apply for mortgages at a higher rate.
