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Economy in Brief

U.S. Mortgage Applications Recover
by Tom Moeller  June 6, 2012

The Mortgage Bankers Association index of total mortgage applications increased 1.3% (55.5% y/y) last week and reversed the prior week's decline. Applications to refinance gained 2.0% (80.8% y/y) but home purchase applications fell 1.8% (-0.4% y/y), down for the fourth straight week. Applications for fixed interest rate loans rose w/w (57.7% y/y) but variable rate loans fell slightly (+21.4% y/y).

The effective rate on fixed-interest, conventional 15-year mortgages slipped to another low of 3.32% and was down from the 4.50% high in February of last year. The effective rate on a 30-year fixed rate loan fell w/w to 4.00%. On a 30-year Jumbo loan the effective rate was 4.23%. 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 ticked up to 2.93% but remained down from its 3.93% high during February of last year.

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) 06/01/12 05/25/12 05/18/12 Y/Y % 2011 2010 2009
Total Market Index 804.8 794.7 804.9 55.5 572.3 659.3 736.4
 Purchase 182.2 185.6 186.7 -0.4 182.6 199.8 263.5
 Refinancing 4,476.2 4,388.8 4,456.4 80.8 2,858.4 3,348.1 3,509.2
15-Year Mortgage Effective Interest Rate (%) 3.32 3.33 3.36 3.94
3.97 4.39 4.85
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