US 30-year mortgage rate falls to 6.13%, refinancing rises By Reuters

(Reuters) – The interest rate on the most popular U.S. home loan fell to 6.13 percent last week, the lowest in two years, and refinancing activity picked up, data from the Mortgage Bankers Association showed on Wednesday.

The average contract rate on a 30-year fixed-rate mortgage fell 2 basis points in the week ended Sept. 20, data showed, a much smaller move than the half-percentage-point cut in the policy rate offered by the Federal Reserve last week.

Mortgage rates have been falling for weeks in anticipation of the Fed’s move and are now down more than three-quarters of a percentage point from July and more than 1.75 percentage points from their October 2023 peak.

Applications to refinance existing home loans increased as homeowners took advantage of falling home loan rates in recent months to reduce their regular home payments. Refinancing now accounts for more than 57 percent of all mortgage applications, the data show, up from the historical average of 48 percent.