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Economy in Brief

U.S. Mortgage Loan Applications Increase Sharply
by Tom Moeller  January 11, 2017

The Mortgage Bankers Association reported that its total Mortgage Market Volume Index jumped 5.8% last week (-4.8% y/y) following a 0.1% uptick during the week prior. Purchase applications surged 6.1% (4.7% y/y) while refinancing applications gained 4.4% (-14.4% y/y).

The effective interest rate on a 15-year mortgage eased to 3.66%, but remained higher than the July low of 2.97%. The effective rate on a 30-year fixed-rate loan of 4.44% was up from the 3.70% low in early-July. The rate on a Jumbo 30-year loan fell to 4.36%. For adjustable 5-year mortgages, the effective interest rate of 3.49% was higher than the 2.87% low early in July.

The average mortgage loan size increased w/w to $264,400 (2.9% y/y). For purchases, it rose to $297,000 (5.8% y/y); for refinancings, it gained to $233,300 (-2.1% y/y).

Applications for fixed interest rate loans declined 5.2% y/y, while applications for variable interest rate loans rose 2.3% 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) 01/06/17 12/30/16 12/23/16 Y/Y 2016 2015 2014
Total Market Index 5.8 0.1 -12.1 -4.8 15.6 17.9 -41.4
 Purchase 6.1 -1.4 -0.7 4.7 13.3 15.5 -12.9
 Refinancing 4.4 1.7 -23.2 -14.4 17.3 19.7 -52.8
15-Year Mortgage Effective Interest Rate (%) 3.66 3.74 3.79 3.43 (Jan '16) 3.22 3.37 3.54
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