September 20, 2011 (Shirley Allen)

Mortgage loan applications to the Federal Housing Administration (FHA) surged 23.9 percent last month partially due to a significant increase in refinance applications according to the agency’s Single-Family Outlook report for August.

The FHA had a total of 142,793 loan applications in August, up from 115,263 applications in July. Applications were still down from August of last year when 200,907 applications were submitted, a decline of 28.9 percent.

Refinance loan applications increased by 60.1 percent from July to August with a total of 49,773 applications submitted in August compared to 31,081 submitted in July.

Refinance applications were still significantly lower compared to last year despite the record low interest rates in August. Applications were 52.4 percent lower than August 2010 which posted 104,652 submitted applications.

Purchase loan applications were also higher in August increasing by 11.2 percent compared to July. A total of 85,080 purchase applications were submitted in August, up from 76,543 applications submitted in July.

Purchase applications were slightly lower than the 86,569 applications that were submitted in August 2010.

The number of completed FHA insured loans increased 9.8 percent to 100,490 in August compared to 91,533 in July, but was still lower than the 139,045 completed applications in August 2010.

Purchase money mortgages accounted for 75.4 percent of all completed FHA insured loans in August with 75,798 completed, an increase of 10.9 percent from July, but still 15.1 percent lower than the 89,322 mortgages in August 2010.

The average FICO score for a homebuyer securing an FHA loan in August was 697, down from 699 in July and unchanged from a year ago. For refinanced transactions, the average FICO score in August was 695, while the average score a year earlier was 698.

At the end of August, the FHA had 7,259,736 insured single-family mortgages in its portfolio with an amortized balance of $1,012.8 billion.

The serious delinquency rate, homes that were 90 days or more past due, was 8.4 percent in August, up from 8.3 percent in July, but down from 8.5 percent in August 2010.

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