Home/Mortgages/FHA Loan Applications Take a Dip in August as Refi’s Slow

October 1, 2012 (Shirley Allen)

Applications for mortgage loans insured by the Federal Housing Administration (FHA) fell in August with home purchase applications increasing slightly while applications to refinance current mortgages slowed according to the agency’s Single-Family Outlook report for August.

A total of 178,314 FHA loan applications were submitted in August, 2.0 percent lower than the 181,951 applications submitted the previous month. Applications were still 24.9 percent higher than the 142,793 applications submitted in August of last year.

Loan applications for refinancing a current mortgage fell 6.4 percent from July with a total of 90,880 applications submitted in August compared to 97,065 in July. Refinance applications were still 82.6 percent higher than in August of last year when 49,773 applications were submitted.

The total number of applications submitted for the purpose of purchasing a home increased in August, climbing by 2.3 percent compared to the previous month and follows a 2.1 percent decline in July. A total of 79,329 applications were submitted in August to purchase homes, up from 77,512 applications submitted in July. Purchase applications were 6.8 percent lower than in August of last year when 85,080 applications were submitted.

Completed applications increased by 13.6 percent from July to August, climbing from 110,924 to 126,051. August’s loan completions were 25.4 percent higher than the 100,490 loans completed a year ago.

Loans for purchased homes accounted for 56.7 percent of all completed FHA insured loans in August with 71,428 completed, an increase of 2.4 percent from July, but 5.8 percent lower than the 75,798 purchase money mortgages in August of 2011.

Refinanced loans accounted for 40.1 percent of all completed loans in August, which was 167.4 percent higher than last year. The 50,501 loans completed in August were 35.5 percent higher than in July.

The average FICO score for a homebuyer securing an FHA loan in August was 695, one point lower than in July and down from 697 a year ago. For refinanced loans, the average FICO score in August was 701, down two points from the previous month but up from 695 a year earlier.

The number of seriously delinquent loans insured by the FHA increased by 0.4 percent from July to August and was 19.0 percent higher than a year ago.

The number of loans that were 90 days or more past due increased by 2,582 in August, bringing the total number of seriously delinquent loans in the FHA’s portfolio to 728,227. In the last year, the number of seriously delinquent loans has increased by 116,405.

The serious delinquency rate was 9.5 percent in August, unchanged from July and up from 8.4 percent in August 2011.

At the end of August, the FHA had 7,691,776 insured single-family mortgages in its portfolio with an amortized balance of $1.081 trillion.

The number of loans insured by the FHA has increased by 6.0 percent in the last year while the amortized balance has increased by 6.7 percent.

Tags: FHA, Single-family Outlook report, loan originations, purchase loans, refinance loans, FICO score, serious delinquency rate