Mortgage rate drop ignites run on refinancing
Mortgage rate drop ignites run on refinancing
Many homeowners are consolidating consumer debt with home loan
By PAUL GORES
of the Journal Sentinel staff
Sunday, October 14, 2001
The lowest mortgage rates in three years have touched off another refinancing boom, with some people consolidating consumer debt along with their home loan, lenders say.
Interest for 30-year fixed-rate mortgages averaged 6.58% last week, compared with 7.84% at this time a year ago, according to a survey by Freddie Mac, the No. 2 buyer of mortgages in the country.
Rates haven’t been lower since October 1998, and the drop has sparked a wave of refinancing inquiries and applications.
“The consumer has become increasingly aware of how attractive current rates are, and activity has been very, very heavy,” said Dick Pas, president of Heartland Home Mortgage Co. in Hales Corners. “We’re all running on pure adrenaline.”
At Marshall & Ilsley Corp., the number of mortgage loan applications has soared from 500 to about 900 per week since the beginning of October. Approximately 80% of those applications are for refinancing, said Ron Cockle, vice president and state sales manager for residential mortgages for M&I.