For the first time since December 2019, purchase mortgages represented a higher percentage of closed mortgages than refinances. They rose to 51% of closed mortgages June compared to 47% in May according to ICE Mortgage Technology. Refinances represented 48% of closed loans.
The origination report found that the average time to close all loans decreased to 49 days in June, a decline from 53 days in May. The average time to close a refi decreased to 48 days from 55 days in May. Things were a bit slower in purchase – the average time to close one hit 51 days, up from 50 days the month prior.
The data show closing rates for all loans decreased to 75.3% in June, down from 76.9% in May. Closing rates on refinances fell to 74.6% in June, down from 77% in May. Closing rates on purchase mortgages dropped to 76.3% in June, a small drop from 77% in May.
Thanks to the continued low rates, buyers are able to purchase more home for their money. Just last week, mortgage rates slipped back down to 2.77%.
According to Sam Khater, chief economist at Freddie Mac, concerns over the COVID-19 Delta variant, along with lower 10-year Treasury yields, have resulted in lower rates.
A year ago at this time, the 30-year fixed-rate mortgage average 2.88%. The 15-year fixed-rate mortgage stood unchanged from the week prior at 2.10%.
Mortgage rates have stayed stubbornly low, barely exceeding 3%, defying predictions that 2021 would bring a return to higher levels. Economists and investors are waiting for any indication that the Federal Reserve may begin tapering its asset purchases. But the central bank has not indicated that it will change its $120 billion in monthly purchases of U.S. Treasury bonds and mortgage backed securities, at least until substantial further progress is made in the labor market.