Each week, LendingTree reports how much consumers can save by comparing rates during the loan shopping process. These savings are presented in two ways, providing the most detailed data on mortgage rates. The LendingTree Mortgage Rate Distribution details the range of mortgage interest rates on offer. The Mortgage Rate Competition Index is the median spread between the lowest and highest APRs offered by lenders in LendingTree's marketplace.
"By calculating this spread and giving transparency to the range of rates offered by lenders on the LendingTree network, we hope to show consumers how much they stand to save by comparing rates during the loan shopping process," said Tendayi Kapfidze, Chief Economist at LendingTree.
Kapfidze continued, "Data on mortgage rates is often presented as a single point value. However, the mortgage market does not work this way, and it's more informative to present mortgage rates as a distribution to represent diversity in pricing. LendingTree's Mortgage Comparison Shopping Report does just this, improving consumers' understanding of the market by showing the range of rates that actual borrowers were offered on the LendingTree platform. With the intense attention on mortgage rates and their implications for the housing market, this is an important addition to the inventory of industry data."
Mortgage Comparison Shopping Report for the week ending Nov. 25, 2018:
Mortgage Rate Distribution
- For 30-year fixed-rate mortgages, 37.4% of purchase borrowers received offers under 5%, up from 29.4% the prior week. A year ago, 98.1% of purchase offers were under 5%.
- Across all 30-year fixed-rate mortgage purchase applications on LendingTree, the most common interest rate was 4.875%, offered to 21.3% of borrowers.
- 27.9% of 30-year fixed-rate mortgage refinance borrowers received offers under 5%, up from 20.1% the prior week. A year ago, 98.1% of refinance offers were under 5%.
- Across all 30-year fixed-rate mortgage refinance applications, the most common interest rate was 5.00%, offered to 22.3% of borrowers.
Mortgage Rate Competition Index
- Across all 30-year fixed rate mortgage purchase applications on LendingTree for the week ending Nov. 25, 2018, the index was 0.59, down 0.06 from the previous week.
- How big of a deal is it to get a mortgage APR that's 0.59 percentage points lower than the competition? Over 30 years, that could translate to $27,454 in savings on a $300,000 loan.
- The index was wider than the purchase market in the refinance market at 0.70, down 0.02 from the previous week. Borrowers could have saved $32,737 by shopping for the lowest rate.
- The distribution of rates — and, as a result, the Mortgage Rate Competition Index — has widened as rates increased, reflecting how mortgage lenders may change the rates at which they can offer consumers loans, depending on their unique business circumstances.
To view this week's Mortgage Comparison Shopping Report, visit https://www.lendingtree.com/home/mortgage/rates/mortgage-rate-competition-index-november-27/.
LendingTree (NASDAQ: TREE) is the nation's leading online marketplace that connects consumers with the choices they need to be confident in their financial decisions. LendingTree empowers consumers to shop for financial services the same way they would shop for airline tickets or hotel stays, comparing multiple offers from a nationwide network of over 500 partners in one simple search, and can choose the option that best fits their financial needs. Services include mortgage loans, mortgage refinances, auto loans, personal loans, business loans, student refinances, credit cards and more. Through the My LendingTree platform, consumers receive free credit scores, credit monitoring and recommendations to improve credit health. My LendingTree proactively compares consumers' credit accounts against offers on our network, and notifies consumers when there is an opportunity to save money. In short, LendingTree's purpose is to help simplify financial decisions for life's meaningful moments through choice, education and support. LendingTree, LLC is a subsidiary of LendingTree, Inc. For more information, go to www.lendingtree.com, dial 800-555-TREE, like our Facebook page and/or follow us on Twitter @LendingTree.