BankRate Benefits from ReFi Fever

BankRate (RATE) shares jumped Wednesday on hopes that that the company will benefit from a rebound mortgage refinance activity following the Fed’s commitment yesterday to inject $600 billion of new capital into Fannie Mae, Freddie Mac, Ginnie Mae and the Federal Home Loan Banks.

As JMP Securities analyst Sameet Sinha pointed out in a research note Wednesday afternoon, the Fed move immediately drove mortgage rates for 30-year loans down by a half-point to 5.5%, down from 6.3% last week. That has triggered what Sinha calls “an unprecedented” jump in activity as homeowners rushed to lock in the low rates. Sinha says that the Fed’s “surprise holiday gift” could drive upside to current estimates for Bankrate, which provides information on mortgages and other loans on the Web.

RATE Wednesday at close was up $4.41, or 18.1%, to $28.84.

Comments

[Refi Guy:]

Home mortgage rates have continued to plummet. Rates are now running as low as under 5% on a 30 year fixed mortgage. This should lead to a much needed resurgence in the mortgage industry. It will be interesting to see how long rates will stay at such low levels. Home refinance rates are unbelievable. Now may be the best time ever to puchase a home with the combination of low interest rates and very low home prices. I just recently found your blog and I will continue to follow you. Very nice blog.

2008 Dec 15 09:11 PM