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Economy in Brief

U.S. Mortgage Loan Applications Decline as Interest Rates Move Up
by Tom Moeller  June 18, 2014

The Mortgage Bankers Association reported that their total Mortgage Market Volume Index declined 9.2% last week (-45.8% y/y) and reversed the prior week's gain. Applications remained two-thirds below the peak in September 2012. Applications to refinance an existing loan fell 12.7% (-58.4% y/y) while home purchase applications declined 4.7% (-15.1% y/y).

The effective interest rate on a 15-year mortgage moved up again, last week to 3.54%, the highest level since early-May. The effective rate on a 30-year fixed rate loan increased to 4.43%. The rate on a Jumbo 30-year loan edged up to 4.35%. For adjustable 5-year mortgages, the effective interest rate held steady at 3.31%, its highest level since early-May.

The average mortgage loan size fell back to $245,300. The average loan size for home purchases inched up to $278,700 but for refinancings it fell to $214,200.

Applications for fixed interest rate loans declined 46.3% y/y while adjustable rate loan applications were off by 39.8% 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) 06/13/14 06/06/14 05/30/14 Y/Y% 2013 2012 2011
Total Market Index 351.6 387.1 350.8 -45.8 616.6 813.8 572.3
 Purchase 178.6 187.5 171.6 -15.1 197.5 187.8 182.6
 Refinancing 1,334.0 1,528.9 1,377.4 -58.4 3,070.0 4,505.0 2,858.4
15-Year Mortgage Effective Interest Rate (%) 3.54 3.49 3.41 3.56
(6/13)
3.42 3.25 3.97
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