If you spot a low rate, don't just sit there. Lock it — so it won't get out of your grasp.

Mortgage refinances slip

Homeowners selected refinancing of house and checking interest rates and monthly payments. Home mortgage loans from bank concept
comzeal images / Shutterstock
Slightly fewer homeowners applied for refinance loans.

Overall mortgage applications edged up 1.5% during the week ending Feb. 21, the Mortgage Bankers Association reported Wednesday. Mortgage activity was muted as mortgage rates rose slightly. But the current week is likely to tell a much different story, because rates have been plummeting.

"Last week appears to have been the calm before the storm," says Mike Fratantoni, chief economist for the Mortgage Bankers Association, in a news release.

Requests for refinance loans slipped 1% last week, after those applications hit a seven-year high earlier in the month.

But last week's refi demand was 152% higher than a year ago — meaning lenders were handling two and a half times the number of refinance applications as they were in mid-February 2019.

Homeowners have been finding that if they refinance, they can slash their monthly payments and total interest costs even if their current mortgages were taken out as recently as 2018. You can review refi offers from multiple banks by visiting LendingTree.

Homebuyers step up their mortgage borrowing

loving couple looking at their home
Serhii Krot / Shutterstock
More hombuyers are taking out loans.

The share of mortgage applications for refinance loans fell last week to 60.8%, from 63.2% a week earlier, as refis cooled and as homebuyers sought more mortgages.

House hunters were finding more of what they wanted last week, so demand for home "purchase loans" rose 6% from the previous week and were up 10% compared with a year ago.

"Purchase volume remained strong, supported both by low rates and the increased pace of construction over the past few months," Fratantoni says. "With housing supply at low levels, new inventory is a positive development for prospective homebuyers."

Builders are cranking up construction to get more new houses ready for the market. Starts on new homes soared 21.4% in January compared to a year earlier, and building permits were at their highest level since March 2007.

Are you thinking about buying? The calculator below shows the monthly house payment you can expect with one of today's low mortgage rates.

Coronavirus fears will keep mortgage rates low

Global Stock Market Going Down
Rawpixel.com / Shutterstock
Coronavirus worries are roiling world financial markets.

Mortgage rates have dropped to the lowest levels in years and are approaching all-time lows as financial markets grow frantic over the rapid spread of the deadly coronavirus.

The average for a 30-year fixed-rate mortgage has dropped this week to 3.33%, according to a survey from Mortgage News Daily. Mortgage giant Freddie Mac reports the benchmark mortgage rate is averaging 3.45% — not far from the all-time low of 3.31%.

Borrowers are being rewarded with big savings if they know how to shop around for the very lowest rates. A $200,000, 30-year fixed mortgage at 3.35% has a monthly payment of $881, while a loan at 4% has a monthly payment of $955.

Mortgage rates are tumbling as investors drain money out of stocks and plow it into Treasury bonds as a safer investment amid the worsening coronavirus crisis.

Rates on home loans track the interest on 10-year Treasury notes, which fell to new depths this week as the hunger for bonds caused their prices to pop. Bond prices and yields move in opposite directions.

"As fears regarding the coronavirus have increased, Treasury yields have dropped to record lows this week amid the ensuing financial market volatility. Next week's results will show the impact this drop in Treasuries had on mortgage activity," Fratantoni says.

In other words, borrowing could boom.

Take a look at today's lowest mortgage rates where you live.