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Economy in Brief

U.S. Mortgage Applications Increase Again As Interest Rates Decline
by Tom Moeller  September 25, 2013

The Mortgage Bankers Association reported that the total mortgage market index increased another 5.5% (-48.4% y/y) last week and added to its 11.2% increase during the prior week. Home purchase mortgage applications rose 6.6% (7.3% y/y) but remained 9.1% below the early-May peak. Applications to refinance an existing loan gained 4.9% but remained down by nearly two-thirds from last September's peak.

The effective interest rate on a 15-year mortgage fell last week to 3.75%, down nearly 20 basis points from its early-month high. It remained up, however, versus the early-May low of 2.89%. The effective rate on a 30-year fixed rate loan also declined to 4.74% last week while the rate on a Jumbo 30-year loan fell to 4.75%. The effective interest rate on an adjustable 5-year mortgage fell w/w to 3.52% but remained up from its low of 2.59% at the beginning of May.

Applications for fixed interest rate loans fell by 49.7% y/y while adjustable rate loan applications were off 16.8% y/y. The average mortgage loan size jumped to $225,100. The average size loan for home purchases surged to $263,100 last week while for refinancings it shot up $200,700.

The survey covers over 75 percent of all U.S. retail residential mortgage applications, and has been conducted weekly since 1990.  Respondents include mortgage bankers, commercial banks and thrifts.  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 SURVEYW database. 

MBA Mortgage Applications (SA, 3/16/90=100) 09/20/13 09/13/13 09/06/13 Y/Y% 2012 2011 2010
Total Market Index 451.9 428.2 385.0 -48.4 813.8 572.3 659.3
 Purchase 200.6 188.1 183.6 7.3 187.8 182.6 199.8
 Refinancing 1,889.2 1,801.7 1,528.5 -61.6 4,505.0 2,858.4 3,348.1
15-Year Mortgage Effective Interest Rate (%) 3.75 3.89 3.93 3.08
3.25 3.97 4.39
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