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Economy in Brief

U.S. Mortgage Loan Applications Tumble
by Tom Moeller  March 23, 2016

The Mortgage Bankers Association reported that its total Mortgage Market Volume Index declined 3.3% last week (+6.4% y/y), the same as during the prior week. Purchase applications fell 1.0% (+25.3% y/y) after a 0.3% uptick, while refinancing applications dropped 4.9% (-4.5% y/y), the fifth consecutive week of sharp decline.

The effective interest rate on a 15-year mortgage held steady at 3.3%, and remained down from the 3.5% highs of November and December. The effective rate on a 30-year fixed-rate loan of 4.0% also was lower versus 4.3% near year-end. The rate on a Jumbo 30-year loan similarly remained down at 3.9%. For adjustable 5-year mortgages, the effective interest rate held steady at 3.3%, and equaled the November/December levels.

The average mortgage loan size eased to $276,400 (+0.1% y/y), down from last month's $298,000 average. For purchases it rose to $305,000 (4.0% y/y), but for refinancings it fell to $251,900 (-4.8% y/y).

Applications for fixed interest rate loans increased 7.5% y/y while adjustable-rate loan applications declined 10.3% y/y.

The survey covers over 75 percent of all U.S. retail residential mortgage applications, and has been conducted weekly since 1990. Respondents include mortgage bankers, commercial banks and thrifts. The base period and value for all indexes is March 16, 1990=100. The figures for weekly mortgage applications and interest rates are available in Haver's SURVEYW database.

MBA Mortgage Applications (SA, 3/16/90=100) 03/18/16 03/11/16 03/04/16 Y/Y % 2015 2014 2013
Total Market Index -3.3 -3.3 0.2 6.4 17.9 -41.4 -24.2
 Purchase -1.0 0.3 4.2 25.3 15.5 -12.9 5.2
 Refinancing -4.9 -5.6 -2.3 -4.5 19.7 -52.8 -31.9
15-Year Mortgage Effective Interest Rate (%) 3.27 3.31 3.24 3.31 3.37 3.54 3.42
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