U.S. Mortgage Loan Applications Fell in the October 18 Week
Summary
- Loan applications to purchase and refinance a house fell again in the latest week.
- The 30-year fixed-rate mortgage was unchanged in the latest week.
- Average loan size declined.
Mortgage loan applications fell 6.7% (+30.0% y/y) in the week ended October 18, the fourth consecutive weekly decline and after declining 17.0% (+37.9% y/y) in the week ended October 11. Applications for loans to purchase a house dropped 5.1% (+3.4% y/y) in the week ended October 18, after falling 7.2% (+6.6% y/y) in the week ended October 11, while applications to refinance an existing mortgage fell 8.4% (+90.0% y/y) following a decline of 26.3% (+111.3% y/y) in the prior week. These data are from the Mortgage Bankers Association's (MBA) Weekly Mortgage Applications Survey.
The effective interest rate on a 30-year fixed-rate mortgage was 6.71% in the week ended October 18, unchanged from the week ended October 11. The effective rate on a 15-year fixed rate mortgage was 6.14%, up 4 bps from the 6.10% rate in the October 11 week, and up 54 bps from the rate four weeks ago. The rate on 30-year Jumbo loans eased 5 bps to 6.90% in the October 18 week from 6.95% in the October 11 week, while the rate on 5-year ARM loans eased 1 bps to 6.32% in the latest week.
The share of loan applications to refinance an existing mortgage was 45.7% in the week ended October 18, down from 46.5% in the week ended October 11. The share of applications for ARMs was 6.1% in the latest week, up from 5.9% in the prior week.
The average size of a mortgage loan application was $383,200 in the week ended October 18, down 1.5% w/w from $389,200 in the week of October 11. The average size of a loan to purchase a house eased 0.5% w/w to $446,300 in the October 18 week, from $448,600 in the prior week. The average size of a loan to refinance dropped 4.0% w/w to $308,200 in the October 18 week, from $321,000 in the October 11 week.
The Mortgage Bankers Association 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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