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Economy in Brief

U.S. Mortgage Applications Decline
by Tom Moeller  December 19, 2012

The Mortgage Bankers Association index of total mortgage applications slumped 12.3% last week (23.9% y/y) to the lowest level since early last month. The decline was led by a 13.8% drop (+28.5% y/y) in applications to refinance an existing loan. Home purchase applications fell 4.8% last week (+9.0% y/y). Applications for fixed interest rate loans rose 26.3% y/y as rates fell. Adjustable rate loan applications fell by 20.6% y/y.

The average mortgage loan size was $218,900 (-3.3% y/y). The average for home purchases was $244,800 (12.9% y/y) while for refinancings it was down 6.5% y/y to $213,700. The average size of a fixed rate loan was $206,500 and for variable rate loans it was $586,400. 

The effective rate on fixed-interest, conventional 15-year mortgages was roughly unchanged at 2.89% last week and remained down compared to 3.47% in January. The effective rate on a 30-year fixed rate was 3.63% while the rate on a Jumbo 30-year loan was 3.82%. Though it's recently narrowed, the spread between 15- and 30-year loan rates continued wide by historical standards. The effective interest rate on an adjustable 5-year mortgage was stable at 2.74%, 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) 12/14/12 12/07/12 11/30/12 Y/Y% 2011 2010 2009
Total Market Index 817.2 931.2 877.0 33.9 572.3 659.3 736.4
 Purchase 198.0 208.0 206.5 9.0 182.6 199.8 263.5
 Refinancing 4,519.1 5,242.9 4,856.7 28.5 2,858.4 3,348.1 3,509.2
15-Year Mortgage Effective Interest Rate (%) 2.89 2.91 2.93 3.54
3.97 4.39 4.85
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