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Mortgage applications increased last week, with the Refinance Index posting a significant gain, which isn’t at all surprising. Weaker than expected Manufacturing and Employment reports sparked rallies in the bond market last week, pushing yields on the 10-Year Treasury below 4% for the first time since April 2004. As a result, rates for fixed rate mortgages dropped into the mid-5% range and adjustable rate mortgages fell into the high 4% range.

This unanticipated drop in rates present consumers with tremendous opportunities to lock in rates near 40-year lows and sparked another wave of refinancing.

Anyone with a fixed rate mortgage of 6% or higher, or an ARM that is about to adjust, should consider taking advantage of the opportunity to lock in a very low rate now before rates rise.

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