Tags: mortgage | applications | home | loan | demand | refinancing

Mortgage Applications Fall 1.8% as Loan Rates Climb

Mortgage Applications Fall 1.8% as Loan Rates Climb
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Wednesday, 29 July 2020 02:49 PM

Deamnd for housing-purchase loans slipped last week as mortgage rates slid.

Mortgage applications decreased 1.8 percent from one week earlier, according to data from the Mortgage Bankers Association's (MBA) Weekly Mortgage Applications Survey.

The Market Composite Index, a measure of mortgage loan application volume, decreased 1.8 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index decreased 2 percent compared with the previous week.

The Refinance Index decreased 2 percent from the previous week and was 74 percent higher than the same week one year ago. The seasonally adjusted Purchase Index decreased 1 percent from one week earlier.

"Mortgage applications fell last week despite mortgage rates hitting another record low in MBA's survey. Investors are contemplating the risks of the recent resurgence of COVID-19 cases to the labor market and economy, and Treasury rates and mortgage rates are moving lower as a result," said Joel Kan, MBA's Associate Vice President of Economic and Industry Forecasting.

"After two months of strong growth, purchase applications declined for the second week in a row. The weakening in activity is potentially a signal that pent-up demand is starting to wane and that low housing supply is limiting prospective buyers' options. The average purchase application loan size increased to a record high in our survey - more proof that tight inventory conditions are leading to faster price growth," Kan said.

"Refinance applications also decreased but remained 74 percent higher than a year ago. The 30-year fixed rate has been below the 3.5 percent mark since late March. It is possible that many borrowers have already refinanced or are waiting for rates to go even lower."

The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($484,350 or less) decreased to 3.29 percent from 3.30 percent.

The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA increased to 3.43 percent from 3.35 percent.

The average contract interest rate for 15-year fixed-rate mortgages remained unchanged at 2.81 percent.

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Mortgage applications decreased 1.8 percent from one week earlier, according to data from the Mortgage Bankers Association's (MBA) Weekly Mortgage Applications Survey.
mortgage, applications, home, loan, demand, refinancing
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2020-49-29
Wednesday, 29 July 2020 02:49 PM
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