Mortgage Applications Up Again in MBA Weekly Survey

MBA NewsLink Staff

April 26, 2017


Mortgage applications increased for the second straight week as key interest rates hit their lowest level in six months, the Mortgage Bankers Association reported this morning in its Weekly Mortgage Applications Survey for the week ending April 21.

The Market Composite Index increased by 2.7 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index increased by 3 percent compared to the previous week.

The Refinance Index increased by 7 percent from the previous week. The refinance share of mortgage activity increased to 44.0 percent of total applications from 42.4 percent the previous week.

The seasonally adjusted Purchase Index decreased by 1 percent from one week earlier. The unadjusted Purchase Index increased by 0.1 percent compared with the previous week and was 0.4 percent higher than the same week one year ago.

The average loan size for refinance applications increased to its highest level since September, $266,900.

"Thirty-year mortgage interest rates followed the 10-year Treasury down to their lowest level since the week following the U.S. presidential election," said MBA Vice President of Research and Economics Lynn Fisher. "The drop was driven by continued investor concerns about the French election, though Sunday's first round voting results apparently have alleviated some investor fears."

As rates fell, Fisher said, applications for refinances increased along with the average refinance loan size. "Large-balance borrowers tend to be more rate sensitive," she said. "That said, refinance volume remained 34 percent below its level from one year ago. Purchase applications were flat relative to the same week last year as tight for-sale inventories continue to provide headwinds for purchasers."

MBA said the FHA share of total applications decreased to 10.0 percent from 11.0 percent the week prior. The VA share of total applications decreased to 10.9 percent from 11.1 percent the week prior. The USDA share of total applications decreased to 0.8 percent from 1.0 percent the week prior.

The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($424,100 or less) decreased to its lowest level since November, 4.20 percent, from 4.22 percent, with points increasing to 0.37 from 0.35 (including origination fee) for 80 percent loan-to-value ratio loans. The effective rate decreased from last week.

The average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances (greater than $424,100) remained unchanged from 4.15 percent, with points increasing to 0.27 from 0.23 (including origination fee) for 80 percent LTV loans. The effective rate increased from last week.

The average contract interest rate for 30-year fixed-rate mortgages backed by FHA decreased to 4.03 percent from 4.09 percent, with points decreasing to 0.34 from 0.36 (including origination fee) for 80 percent LTV loans. The effective rate decreased from last week.

The average contract interest rate for 15-year fixed-rate mortgages decreased to its lowest level since November, 3.46 percent, from 3.50 percent, with points increasing to 0.50 from 0.41 (including origination fee) for 80 percent LTV loans. The effective rate decreased from last week.

The average contract interest rate for 5/1 adjustable-rate mortgages decreased to its lowest level since November, 3.22 percent, from 3.27 percent, with points decreasing to 0.18 from 0.26 (including origination fee) for 80 percent LTV loans. The effective rate decreased from last week.

The ARM share of activity increased to 8.7 percent of total applications.

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

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