Quantcast

Home / News / Business News / Mortgage applications decrease nationwide after hitting 11-month peak

Mortgage applications decrease nationwide after hitting 11-month peak

A house for sale in east Boise. Nationwide, mortgage applications decreased from Jan. 11 to 18. Photo by Liz Harbauer.

Across the country, mortgage applications decreased 2.7 percent from Jan. 11 to 18 after hitting an 11-month peak, according to data from the Mortgage Bankers Association’s Weekly Mortgage Applications Survey.

The Market Composite Index, a measure of mortgage loan application volume, decreased 2.7 percent on a seasonally adjusted basis during that time. On an unadjusted basis, the Index decreased 0.3 percent compared with the previous week. The Refinance Index decreased 5 percent from the previous week. The seasonally adjusted Purchase Index decreased 2 percent from one week earlier. The unadjusted Purchase Index increased 4 percent compared with the previous week and was 13 percent higher than the same week one year ago.

“Mortgage application activity cooled off after two consecutive weeks of sizeable increases. Both purchase and refinance applications saw declines but remained at healthy levels, with the purchase index remaining close to a nine-year high, and the refinance index hovering near its highest level since last spring,” said Joel Kan, MBA’s Associate Vice President of Economic and Industry Forecasting. “Reversing the recent downward trend, rates increased for most loan types last week, due to better-than-expected unemployment claims, easing trade tensions and stabilization in the equity markets.”

The refinance share of mortgage activity decreased to 44.5 percent of total applications from 46.8 percent the previous week. The adjustable-rate mortgage (ARM) share of activity decreased to 8.3 percent of total applications.

The FHA share of total applications decreased to 10.5 percent from 10.9 percent the week prior. The VA share of total applications decreased to 10.3 percent from 10.4 percent the week prior. The USDA share of total applications decreased to 0.4 percent from 0.5 percent the week prior.

The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($484,350 or less) increased to 4.75 percent from 4.74 percent, with points decreasing to 0.44 from 0.45 (including the origination fee) for 80 percent loan-to-value ratio (LTV) loans. The effective rate remained unchanged from last week.

The average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances (greater than $484,350) increased to 4.59 percent from 4.53 percent, with points decreasing to 0.25 from 0.31 (including the origination fee) for 80 percent LTV loans. The effective rate decreased from last week.

The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA increased to 4.82 percent from 4.76 percent, with points increasing to 0.62 from 0.52 (including the origination fee) for 80 percent LTV loans. The effective rate increased from last week.

The average contract interest rate for 15-year fixed-rate mortgages decreased to 4.12 percent from 4.13 percent, with points increasing to 0.53 from 0.45 (including the origination fee) for 80 percent LTV loans. The effective rate increased from last week.

The average contract interest rate for 5/1 ARMs increased to 4.12 percent from 4.08 percent, with points increasing to 0.42 from 0.32 (including the origination fee) for 80 percent LTV loans. The effective rate increased from last week.

The survey covers over 75 percent of all U.S. retail residential mortgage applications, and has been conducted weekly since 1990. Respondents include mortgage bankers, commercial banks and thrifts.

About IBR Staff