U.S. Mortgage Applications Decline in the Latest Week
Summary
- Overall mortgage applications retrenched in the week of February 10.
- Applications for loans to both purchase and refinance declined in the latest week.
- The average effective rates on fixed loans rose in the latest week.
Mortgage applications declined 7.7% (-57.1% y/y) in the week ended February 10, following a 7.4% advance during the prior week. These data are from the Mortgage Bankers Association's (MBA) Weekly Mortgage Applications Survey.
Applications for purchase declined 5.5% (-35.6% y/y) in the week ended February 10 after a rise of 3.1% in the prior week. Applications to refinance an existing loan dropped 12.5% (-75.8% y/y) following the 17.7% jump in the week of February 3.
The percentage of applications for refinancing an existing loan declined to 32.0% in the week ended February 10, from 33.9% the prior week. The percentage of ARM loans edged up to 6.9% from 6.6%. The recent high of 12.8% was reached in the second week of October.
The effective interest rate on a 30-year fixed-rate loan rose 24bps to 6.60% in the week ended February 10, from 6.36% in the prior week, though still down from a recent high of 7.42% in the third week of October. The effective rate on 15-year fixed-rate mortgages rose 26bps to 6.06% from 5.80% in the prior week. The rate on 30-year Jumbo loans rose 26bps to 6.38% in the week of February 10 from 6.12% prior week. The rate on a 5-year ARM eased 6bps to 5.80% in the latest week.
The average loan size rose 1.1% (2.7% y/y) to $382,500 in the week ended February 10. The series high of $401,900 was reached in the week ended May 6. The average size of a purchase loan rose 1.1% (-4.3% y/y) to $433,300. The average loan size to refinance a mortgage decreased 2.1% (-8.7% y/y) to $274,300.
The Mortgage Bankers Survey covers 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 SURVEYS database.
Kathleen Stephansen, CBE
AuthorMore in Author Profile »Kathleen Stephansen is a Senior Economist for Haver Analytics and an Independent Trustee for the EQAT/VIP/1290 Trust Funds, encompassing the US mutual funds sponsored by the Equitable Life Insurance Company. She is a former Chief Economist of Huawei Technologies USA, Senior Economic Advisor to the Boston Consulting Group, Chief Economist of the American International Group (AIG) and AIG Asset Management’s Senior Strategist and Global Head of Sovereign Research. Prior to joining AIG in 2010, Kathleen held various positions as Chief Economist or Head of Global Research at Aladdin Capital Holdings, Credit Suisse and Donaldson, Lufkin and Jenrette Securities Corporation.
Kathleen serves on the boards of the Global Interdependence Center (GIC), as Vice-Chair of the GIC College of Central Bankers, is the Treasurer for Economists for Peace and Security (EPS) and is a former board member of the National Association of Business Economics (NABE). She is a member of Chatham House and the Economic Club of New York. She holds an undergraduate degree in economics from the Universite Catholique de Louvain and graduate degrees in economics from the University of New Hampshire (MA) and the London School of Economics (PhD abd).
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