Mortgage rates have been on a downward trend for the past month or so, ever since the fed paused the rate hikes, but business is still nowhere near the levels of a year ago. And anyone looking to refinance their current mortgage or buy a new home will likely land a great rate. But it seems most people have already refinanced, and the housing market has cooled off, so despite the resurgence of enticing rates, mortgage applications continue to fall.
Not only are there fewer borrowers out there looking for mortgages, but many lenders and mortgage brokers have either shut down or cut staff tremendously. So you’d think those that stayed in business would be seeing a windfall. But that doesn’t seem to be the case, even with interest rates at levels they were at a year ago. And on top of all what seems to point to more business, banks and mortgage lenders are offering new loan programs to further entice borrowers that have never been offered before. Hybrid option-arm programs and 50-year fixed mortgages, or simple adjustable-rate mortgages with 40 to 50 year amortization.
But all thats being done to stave off the slump is simply not enough to bring back the business of five years ago. I don’t think it’s a surprise, and it’s clear that most people took the hint and refinanced long ago. And as I mentioned before, anyone looking for a home likely did so already, or simply can’t afford one at the current levels. And maybe the number of banks and lenders out there offering mortgages is still much too high for the current demand, or any demand for that matter. It seems everywhere you turn these days you’ll hear someone talking about mortgage. And there are still those who are talking about getting into real estate, despite coming on a bit too late.
My next step is to find out where all the business has gone. And if it’s simply just spread too thin, or if the boom is now bust.