According to The Mortgage Bankers Association (MBA), mortgage applications increased last week as mortgage interest rates continued to fall from their highest level in 23 years. The MBA said its Market Composite Index, a measure of application volume, increased 2.8% on a seasonally adjusted basis from one week earlier and was up 0.4% before adjustment.
Purchase applications rose 3.0% on a seasonally adjusted basis but slipped by 0.3% before adjustment. The Purchase Index was 12% lower than the same week one year ago.
Refinance applications increased 2% for the week and were 7% higher than the same week one year ago.
“Although Treasury rates dipped midweek, mortgage rates were little changed on average through the week. The 30-year fixed mortgage rate remained at 7.61%, about 30 basis points lower than three weeks ago,” said Joel Kan, MBA’s Vice President and Deputy Chief Economist. “Both purchase and refinance applications increased to the highest weekly pace in five weeks but remain at very low levels.
One other positive highlight from the MBA Weekly Applications Survey is that loan sizes increased slightly, ending a four-week slide. The average loan size was $355,700 compared to $353,600 and purchase loans averaged $406,600, $1,400 higher than the previous week.
While we still have a long way to go on a mortgage industry rebound, this is positive news, and even a small decrease in rates can result in an increase in the application volume.
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By: Jon Iacono