The week ended April 25 was one of the
slowest for mortgage application activity the industry has seen in years. The Mortgage Bankers Association (MBA) said
applications for both purchase mortgages and refinancing decreased and its
Market Composite Index, a measure of overall mortgage applications volume, fell
to its lowest level in almost 15 years.
The Composite decreased 5.9 percent on a
seasonally adjusted basis from the week ended April 18 and was down 5 percent
on a non-seasonally adjusted basis.
Refinancing activity fell 7 percent and purchase applications were off 4
percent from a week earlier on both a seasonally adjusted and an unadjusted
basis and was 21 percent lower than during the same week in 2013.
Refinancing fell to exactly half of all mortgage
applications from 51 percent the previous week.
This is the lowest share for refinancing since July 2009 and it is 13
percentage points below the level at the beginning of 2014.
Refinance Index vs 30 Yr Fixed
Purchase Index vs 30 Yr Fixed
purchase and refinance application activity fell last week, and the market
composite index is at its lowest level since December 2000," said Mike
Fratantoni, MBA's Chief Economist. "Purchase applications decreased 4 percent
over the week, and were 21 percent lower than a year ago. Refinance activity
also continued to slide despite a 30-year fixed rate that was unchanged from
the previous week. The refinance index dropped 7 percent to the lowest level
since 2008, continuing the declining trend that we have seen since May 2013."
interest rates for fixed rate mortgages were lower or unchanged from the
previous week while effective rates all decreased. Interest rates for 5/1 adjustable rate
mortgages did increase during the week with the average contract rate rising 10
basis points to 3.26 percent. Points
decreased to 0.35 from 0.36 and the effective rate decreased from the previous
week. Approximately 8 percent of
mortgage applications were for the various adjustable rate products,
essentially unchanged from the previous week.
average contract interest rate for 30-year fixed-rate mortgages (FRM) with
conforming loan balances of $417,000 or less was unchanged at 4.49 percent,
with points decreasing to 0.38 from 0.50.
The average contract interest rate for jumbo 30-year fixed-rate
mortgages with balances greater than $417,000 decreased to 4.37 percent from
4.41 percent, with points dropping to 0.14 from 0.34.
average contract interest rate for 30-year fixed-rate mortgages backed by the
FHA decreased to 4.17 percent from 4.20 percent with points decreasing to 0.10
from 0.41 and the rate for 15-year fixed-rate mortgages decreased to 3.53
percent from 3.55 percent. Points for
the 15-year decreased to 0.31 from 0.33.
is derived from its Weekly Mortgage Applications Survey which it has conducted
since 1990 and which covers over 75 percent of all U.S. retail residential
mortgage applications. Survey
respondents include mortgage bankers, commercial banks and thrifts. Interest rate information is based on loans
with an 80 percent loan-to-value ratio and points include the origination
fee. Base period and value for all
indexes is March 16, 1990=100.