Record low interest rates coupled with rising home values have ignited a rise in refinancing across the Bay Area in California.
Homeowners in some areas are now able to get new loans with more pleasing terms as their houses or apartments are worth more because of the recovering housing market. Meanwhile, other home owners who have more home equity, are refinancing for the second or third time in a year, as rates have continued to tumble.
The current interest rates on a 30-year fixed mortgage averaged 3.71 percent last week; according to government controlled mortgage giant Freddie Mac. For the same period last year, the average rate was at 4.5 percent.
"The people who refinanced six months ago are refinancing again," said Al Sanli of Advantage Funding in Orinda, according to Mercury News.
Purchase loans are also up because buyers are lured by a combination low interest rates and more affordable pricing.
The Mortgage Bankers Association reports refinance applications were up nearly 13 percent in California in May from April, and almost 89 percent above May 2011. Refinancings made up nearly 81 percent of California mortgage applications in May, the MBA reported.
