Mortgage Applications Dip Amidst Rising Rates

Published:
May 29, 2020
Last updated:
May 17, 2022
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Mortgage rates play a key role in determining how expensive your mortgage will be over the life of the loan.

A low interest rate will mean you will be paying less in interest overall, making your mortgage more affordable. Conversely, a high interest rate will mean that more money will have to be paid towards interest over the life of the loan, making the mortgage more expensive.

So, is today a potentially ideal time to buy a home? What are mortgage rates in WA, CO, ID, and OR doing today?

If they’re able to snag a decent interest rate on a mortgage, prospective home buyers the chance to save tens of thousands of dollars (or more) on their mortgages.

Current Mortgage Rates

Mortgage rates in WA, OR, ID, and CO are as follows:

Having said that, the exact mortgage rate that you are able to lock in at will depend on your credit and financial profile, loan-to-value ratio, and the mortgage company that you work with. All these factors will play a role in the precise interest rate that you get.

Mortgage Rate Trends

Mortgage rates are increasing, and they have been for many months. While rates may be lower than they were over a decade ago, they’re certainly much higher than where they were at the same time last year. Experts agree that rates could climb even further this year.

Live Mortgage Rates

Factors Influencing Rising Mortgage Rates

Mortgage rates have been inching up for a few reasons. For starters, the Federal Reserve has hinted that it would increase rates several times this year. Further, rising rates are also in response to high inflation. 

Experts speculate that the Federal Reserve will increase its benchmark rate three times throughout 2022, and perhaps even four times. 

The Fed Reserve doesn’t set mortgage interest rates, but rather determines the federal funds rate. This rate, in turn, affects short-term and adjustable interest rates. Lower costs can then be passed on to consumers with lower rates on some mortgages.

Economic uncertainty can also influence mortgage rates. That said, the real estate markets in places like Seattle, Portland, Denver, and Boise are still very active.

Increase in Interest Rates and Dip in Mortgage Applications

Every week, the Mortgage Bankers Association (MBA) puts out a survey that outlines the most recent mortgage activity. In its latest survey for the week of April 20, 2022, the MBA shows that mortgage applications decreased slightly from the week before. According to the Market Composite Index, mortgage application volume decreased 5% on a seasonally-adjusted basis from the previous week earlier. 

Mortgage refinances also decreased, according to the Refinance Index. The index showed an 8% decrease from the previous week, and was 68% lower compared to the same week in 2021.

Demand among homebuyers is still very strong, however, despite these figures. But buyers continue to be hindered by the lack of housing supply and rapidly increasing prices of homes. 

As the economy slowly starts to open back up, new home purchases are subsequently on the horizon, potentially sparking stronger mortgage application activity among Americans.

Is Now the Right Time to Buy a Home?

Whether you are considering buying a home in Washington, Idaho, Colorado, or Oregon, now might be a great time to make a home purchase. If rates continue to rise, you’ll end up paying more in interest than you need to. You may want to get into the market sooner before rates continue to rise.

Let’s illustrate how just a 1% difference in interest rates makes in the cost of a mortgage. Assuming a $500,000 mortgage with a 30-year fixed-rate mortgage, we’ll compare a fictitious rate of 3.11% to a rate of 4.11%, which is 1% higher.

Based on these numbers, the amount of interest you would pay over a 30-year term would be:

  • 3.11% interest: $267,656
  • 4.11% interest: $367,174

That’s a difference of $100,000! As you can see, locking in at a low rate is very important, and you can do that by applying for a mortgage today. Just be sure to work with a trusted mortgage company that will work hard to get you a mortgage product with the most favorable terms and interest rates.

Get an Instant Mortgage Rate Quote Today

Ready to Apply For a Mortgage in WA, OR, CO, or ID?

Do you have questions about home loans? Are you ready to apply for a mortgage to buy a home? If so, Sammamish Mortgage can help. We are a local mortgage company from Bellevue, Washington serving the entire state, as well as Oregon, Idaho, and Colorado. We offer many mortgage programs to buyers all over the Pacific Northwest since 1992. Contact us today with any questions you have about mortgages.

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