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Economy in Brief

U.S. Mortgage Loan Applications Retrace Earlier Gains; Mortgage Rates Are Roughly Stable
by Tom Moeller  July 16, 2014

The Mortgage Bankers Association reported that their total Mortgage Market Volume Index declined 3.6% last week (-34.3% y/y) to the lowest level since late-April. Applications remained two-thirds below the peak in September 2012. Home purchase applications fell 7.6% (-17.2% y/y) while applications to refinance an existing loan were roughly unchanged (-43.6% y/y).

The effective interest rate on a 15-year mortgage held roughly steady last week at 3.47% and was nearly the lowest rate since late-May. The effective rate on a 30-year fixed rate loan ticked up to 4.39%. The rate on a Jumbo 30-year loan was fairly steady at 4.30%. For adjustable 5-year mortgages, the effective interest rate moved down to 3.29%, its lowest level since late-May.

The average mortgage loan size fell to $241,800. The average loan size for home purchases declined to $268,500 and for refinancings it fell to $218,600.

Applications for fixed interest rate loans declined 34.6% y/y while adjustable rate loan applications were off by 30.4% 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) 07/11/14 07/04/14 06/27/14 Y/Y% 2013 2012 2011
Total Market Index 341.1 353.9 347.3 -34.3 616.6 813.8 572.3
 Purchase 167.8 181.7 175.2 -17.2 197.5 187.8 182.6
 Refinancing 1,327.4 1,328.9 1,323.9 -43.6 3,070.0 4,505.0 2,858.4
15-Year Mortgage Effective Interest Rate (%) 3.47 3.46 3.46 3.79
3.42 3.25 3.97
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