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Economy in Brief

U.S. Mortgage Loan Applications Ease; Rates Remain Low
by Tom Moeller  April 27, 2016

The Mortgage Bankers Association reported that its total Mortgage Market Volume Index declined 4.1% last week (+12.8% y/y) following three consecutive weeks of firm gain. So far in April, applications have risen 6.4% versus March following that month's 7.9% decline. Applications to refinance fell 5.0% (+11.8% y/y) following a 2.6% increase. So far in April, refinance applications are 8.5% higher than in March, following a 14.7% shortfall. Purchase application declined 2.4% (+14.4% y/y), off for the third week in the last four. In April, these applications have risen the same 4.0% m/m as in March.

The effective interest rate on a 15-year mortgage of 3.18% remained down from the 3.50% highs of November and December. The effective rate on a 30-year fixed-rate loan of 3.95% also was lower versus 4.28% near year-end. The rate on a Jumbo 30-year loan similarly remained down at 3.88%. For adjustable 5-year mortgages, the effective interest rate was 3.07%.

The average mortgage loan size held steady w/w at $278,700 (+3.8% y/y). For purchases, it rose to $304,200 (2.4% y/y); for refinancings, it declined to $257,400 (+4.9% y/y).

Applications for fixed interest rate loans increased 13.4% y/y, while adjustable-rate loan applications gained 3.5% 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) 04/22/16 04/15/16 04/08/16 Y/Y 2015 2014 2013
Total Market Index -4.1 1.3 10.0 12.8 17.9 -41.4 -24.2
 Purchase -2.4 -0.5 8.4 14.4 15.5 -12.9 5.2
 Refinancing -5.0 2.6 11.3 11.8 19.7 -52.8 -31.9
15-Year Mortgage Effective Interest Rate (%) 3.18 3.14 3.19 3.21 3.37 3.54 3.42
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