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Economy in Brief

U.S. Mortgage Loan Applications Rebound as Interest Rates Decline
by Tom Moeller  April 16, 2014

The Mortgage Bankers Association reported that their total Mortgage Market Volume Index jumped 4.3% last week (-57.7% y/y) to the highest level in four weeks. Applications nevertheless remained two-thirds below the peak in September 2012. Applications to refinance a loan jumped 6.9% (-69.8% y/y) while home purchase applications increased 1.3% (-16.1% y/y), the sixth rise in the last seven weeks.

The effective interest rate on a 15-year mortgage fell to 3.60%, the lowest level in four weeks. The effective rate on a 30-year fixed rate loan declined to 4.56% but still was up from 3.68% last May. The rate on a Jumbo 30-year loan of 4.44% compared to a low of 3.85%. For adjustable 5-year mortgages, the effective interest rate at 3.30% was the lowest in a month.

The average mortgage loan size increased to $240,800, the highest level since late-2008. The average loan size for home purchases rose to $276,200 and for refinancings it rose to $208,000.

Applications for fixed interest rate loans declined 59.3% y/y while adjustable rate loan applications were off 26.9% y/y.

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. 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 SURVEYW database.

MBA Mortgage Applications (SA, 3/16/90=100) 04/11/14 04/04/14 03/28/14 Y/Y% 2013 2012 2011
Total Market Index 366.1 351.0 356.7 -57.7 616.6 813.8 572.3
 Purchase 182.7 180.3 175.6 -16.1 197.5 187.8 182.6
 Refinancing 1,414.4 1,322.9 1,391.3 -69.8 3,070.0 4,505.0 2,858.4
15-Year Mortgage Effective Interest Rate (%) 3.60 3.70 3.68 2.97
3.42 3.25 3.97
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