Mortgage Applications Decline as Mortgage Rates Continue to Rise

(January 31, 2013) Mortgage applications declined for the first time this year as both purchase and refinance applications slowed in the face of rising interest rates according to the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending January25th 2013.

The Market Composite Index, which measures mortgage loan application volume including purchase applications and refinance applications, declined a seasonally adjusted 8.1 percent and follows a 17.0 percent increase from the previous week.

On an unadjusted basis, mortgage loan application volume fell by 17 percent after increasing by seven percent the week before.

Purchase Applications:

The seasonally adjusted Purchase Index fell two percent from last week after climbing by three percent the week before, while the unadjusted Purchase Index was six percent lower than the previous week. The unadjusted Purchase Index was still two percent higher than during the same period last year.

Refinance Applications:

The Refinance Index declined ten percent from last week after increasing by eight percent the week before. The refinance share of mortgage activity fell from 82 percent of total applications the previous week to 79 percent last week.

Mortgage Interest Rates:

Average Contract Mortgages Rates
(80% loan-to-value)

Type of
Loan

Interest Rate (%)

Points

Effective Rate

Current

Previous

Current

Previous

30-Year FRM Conforming
($417,500 or less)

3.67

3.62

0.42

0.43

Increased

30-Year FRM Non-Conforming
($417,501 or more)

3.95

3.85

0.39

0.34

Increased

15-Year FRM

2.95

2.87

0.39

0.27

Increased

FHA 30-Year

3.48

3.40

0.33

0.53

Increased

5/1 ARM

2.60

2.61

0.33

0.32

Decreased

The adjustable-rate mortgage (ARM) share of activity remained around four percent of total applications.

Tags: MBA, home purchase applications, mortgage rates, fixed rate mortgage, adjustable rate mortgage, refinance, interest rate

Source:
Mortgage Bankers Association

Reported by Chris Moore