U.S. mortgage rates decline further; more homeowners look to refinance

July 28 (UPI) -- Mortgage rates in the United States have dipped again, sending borrowers to the bank and homeowners to lenders to refinance and save money on their monthly payments, an industry report said Wednesday.

The Mortgage Bankers Association said in its weekly assessment that the rate for 30-year fixed-rate mortgages declined to 3.01%, and for 15-year mortgages it's 2.36%.

The 30-year rate is the lowest since February and the mark for 15-year mortgages is a record low, the MBA report said.

Also, homeowner applications to refinance increased by nearly 10%. Refinancing made up 67% of the total applications last week.

Applications for a new mortgage to purchase a home, however, were down 2% last week -- and 18% off of this time last year.

Joel Kan, MBA associate vice president of economist and industry forecasting, said those buyers may be discouraged by higher home prices and increased competition.

The MBA report came a few hours ahead of the Federal Reserve's latest policy decision on key interest rates. The Fed, which will announce its decision at 2 p.m. EDT, hasn't raised the federal funds rate since last year.

"If the Fed says the recent surge in [COVID-19] cases was on their radar and that there hasn't been any reconsideration of 'late 2021' tapering goals, rates could definitely pop higher," said Matthew Graham, chief operating officer at Mortgage News Daily, according to CNBC.