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Economy in Brief

U.S. Mortgage Loan Applications Fall Further as Interest Rates Rise
by Tom Moeller  February 25, 2015

The Mortgage Bankers Association reported that their total Mortgage Market Volume Index declined 3.5% last week (+20.6% y/y). It was the the fourth decline in the last five weeks, totaling 25.2%. Refinance applications fell 7.5% (+27.8% y/y). It also was the fourth decline in five weeks, totaling 32.2%. Home purchase applications gained 4.6% (9.8% y/y) but still were off 11.8% from the peak six weeks ago.

The effective interest rate on a 15-year mortgage held steady at 3.35%. It remained up, however, from its low of 3.17% five weeks ago. The effective rate on a 30-year fixed rate loan ticked up to 4.09%, also up from its low of 3.87%. The rate on a Jumbo 30-year loan increased to 4.15%, up from its 3.88% low. For adjustable 5-year mortgages, the effective interest rate rose w/w to 3.40%, up from 3.02% one month ago.

The average mortgage loan size fell to $254,400 (+11.7% y/y). For home purchases, it held fairly steady at $288,800 (+8.3% y/y) but for refinancings, it fell sharply to $233,300 (+16.7% y/y).

Applications for fixed interest rate loans were up 23.8% y/y. Adjustable rate loan applications declined 18.3% 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) 02/20/15 02/13/15 02/06/15 Y/Y % 2014 2013 2012
Total Market Index 420.3 435.6 501.8 20.6 361.5 616.6 813.8
 Purchase 170.2 162.7 175.1 9.8 172.1 197.5 187.8
 Refinancing 1,861.8 2,012.8 2,395.8 27.8 1,449.8 3,070.0 4,505.0
15-Year Mortgage Effective Interest Rate (%) 3.35 3.33 3.22 3.60
(2/14)
3.54 3.42 3.25
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