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Economy in Brief

U.S. Mortgage Applications Slip W/W But Surge Y/Y
by Tom Moeller March 7, 2012

The index of total mortgage applications slipped 1.2% last week to 754.4 (+46.7% y/y), down for the fourth consecutive week. Nevertheless, applications were up by nearly one-half versus last year. Applications to refinance fell 2.0% (+73.8% y/y), down for the third straight week. Conversely, applications to purchase a home rose 2.1% (-8.1% y/y) after a larger gain during the week prior. Despite the increases, purchase applications remained 60% lower than the peak in late-2007. Applications for both fixed and adjustable rate loans slipped w/w though the trend in fixed rate financing continued strong with low interest rates.

The effective rate on fixed-interest, conventional 15-year mortgages held at a low 3.45%. The effective rate on a 30-year fixed rate loan also held at 4.20%. On a 30-year Jumbo the effective rate was 4.44%. Though it's narrowed slightly of late, the spread between 15- and 30-year loan rates continued wide by historical standards. The effective interest rate on an adjustable 5-year mortgage dropped to 2.91% versus 3.73% last March.

The Mortgage Bankers Association surveys between 20 to 35 of the top lenders in the U.S. housing industry to derive its refinance, purchase and market indexes. The weekly survey covers roughly 50% of all U.S. residential mortgage applications processed each week by mortgage banks, commercial banks and thrifts. The figures for weekly mortgage applications are available in Haver's SURVEYW database.

MBA Mortgage Applications (SA, 3/16/90=100) 03/02/12 02/24/12 02/17/12 Y/Y % 2011 2010 2009
Total Market Index 754.4 763.6 766.1 46.7 572.3 659.3 736.4
 Purchase 178.7 175.1 161.8 -8.1 182.6 199.8 263.5
 Refinancing 4,141.7 4,225.4 4,322.0 73.8 2,858.4 3,348.1 3,509.2
15-Year Mortgage Effective Interest Rate (%) 3.45 3.46 3.47 4.34
3.97 4.39 4.85
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