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Economy in Brief

U.S. Mortgage Loan Applications Fall
by Sandy Batten  April 19, 2017

The Mortgage Bankers Association reported that its total Mortgage Applications Volume Index declined 1.8% last week (-24.9% y/y) in the week of April 14, more than reversing the 1.5% w/w rise in the preceding week. Refinancing applications were relatively steady, edging up just 0.2% w/w but continued their sharp annual decline--down 41.5% y/y. Purchase applications fell 3.4% w/w (-1.0% y/y) after posting three consecutive weekly increases.

The effective interest rate on a 15-year mortgage edged up to 3.60% from 3.59% the previous week while the effective rate on a 30-year fixed-rate loan continued to ease, to 4.32%. The rate on a Jumbo 30-year loan fell 11 basis points to 4.21%, its lowest level since November 2016. For adjustable 5-year mortgages, the effective interest rate slipped to 3.36% from 3.39% the previous week.

The average mortgage loan size edged down from the previous week to $288,700 (+3.8% y/y). For purchases, loan size slipped $6,000 to $312,700 (+4.0% y/y); for refinancings, it rose nearly $6,000 to $256,000 (-1.5% y/y).

Recent diversion of trends in the breakdown of applications into adjustable and fixed interest rates continued. Applications for adjustable rate loans increased 25.0% y/y, while applications for fixed rate loans declined 27.5% y/y.

The survey covers over 75% 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) 04/14/17 04/07/17 03/31/17 Y/Y 2016 2015 2014
Total Market Index -1.8 1.5 -1.6 -24.9 15.6 17.9 -41.4
 Purchase -3.4 2.9 0.7 -1.0 13.3 15.5 -12.9
 Refinancing 0.2 0.0 -4.2 -41.5 17.3 19.7 -52.8
15-Year Mortgage Effective Interest Rate (%) 3.60 3.59 3.66 3.18 (April '16) 3.22 3.37 3.54
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