Low-interest rates cause mortgage applications to rise

Mortgage applications rose by more than ten percent in the February compared to the same month last year, the Mortgage Data Network (HDN) reports. Many of the applicants were looking to profit from the low-interest rates.

Nearly one-third of the 45 thousand applications placed in February were filed by re-financiers. The average mortgage sum of this group was 252 thousand euros compared to 234 thousand in the same month last year. The vast majority of re-financiers chose to fix their interest rate for the upcoming 20 years.

Recently, interest rates have been at an all time low, with the average interest rate for mortgage applications falling to 1.7 percent.

First-time mortgage applicants account for around a quarter of total applications. The number of people buying a second home or a home that will be owner-occupied later has sunk slightly in the past months, however, still makes up a quarter of all applications. On the other hand, more people are choosing to take on a second mortgage. This could mean that they are choosing to renovate their homes, the HDN stated.

85 percent of all mortgage applications are filed via HDN, according to their website. The HDN is an initiative of various mortgage, credit and insurance companies.