Mortgage rates fell for the sixth week in a row, to a level last seen in the spring.
The benchmark 30-year fixed-rate mortgage fell 3 basis points to 5.22 percent, according to the Bankrate.com national survey of large lenders. A basis point is one-hundredth of 1 percentage point. The mortgages in this week’s survey had an average total of 0.34 discount and origination points. One year ago, the mortgage index was 6.2 percent; four weeks ago, it was 5.4 percent.
The benchmark 15-year fixed-rate mortgage fell 4 basis points to 4.6 percent. The benchmark 5/1 adjustable-rate mortgage fell 3 basis points to 4.66 percent.
The 30-year fixed has been below 6 percent all year in Bankate’s weekly survey. It rose as high as 5.95 percent in early June, not long after hovering at 5.2 percent or lower for four weeks in a row in March and April. There was a minor refinancing boomlet back then, and another one now.
Closings take longer now
That’s probably just as well, because it’s taking longer to close on a mortgage. At the end of July, the Federal Reserve imposed new rules that require waiting periods before a loan can close. The regulation compels a waiting period of seven business days between the time the initial loan disclosure documents are sent and the transaction can be closed.
But that’s not all. If the lender’s good faith estimate was off, and the loan’s annual percentage rate changes by one-eighth of a percentage point or more (in either direction), then the lender has to send out more disclosures – and another three-day waiting period begins before the loan can be closed.
The idea was to protect borrowers from lenders surprising them with last-minute changes in rate or fees. But some borrowers end up paying fees to extend their rate locks past 30 days in case of delays
