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Economy in Brief

U.S. Mortgage Loan Applications Rebound; Rates Decline
by Tom Moeller  May 24, 2017

The Mortgage Bankers Association reported that its total Mortgage Applications Volume Index increased 4.4% (-16.2% y/y) in the week ended May 19, after a 4.1% decline during the prior week. Refinancing applications rebounded 10.5% (-30.1% y/y) following a 5.7% fall. Purchase applications were off 0.8% (+2.9% y/y) after a 2.7% decline.

The effective interest rate on a 15-year mortgage held fell to 3.55%, the lowest level since late-November. The effective rate on a 30-year fixed-rate loan dropped to 4.28%. The rate on a Jumbo 30-year loan fell to 4.30%. For adjustable 5-year mortgages, the effective interest rate rose slightly to 3.40%.

The average mortgage loan size rose to $293,400 (3.7% y/y). For purchases, loan size decreased to $319,300 (+3.8% y/y); for refinancings, it rebounded to $260,500 (-0.5% y/y).

Applications for adjustable rate loans increased 20.0% y/y, while applications for fixed rate loans declined 18.4% y/y.

The survey covers over 75% 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) 05/19/17 05/12/17 05/05/17 Y/Y 2016 2015 2014
Total Market Index 4.4 -4.1 2.4 -16.2 15.6 17.9 -41.4
 Purchase -0.8 -2.7 1.7 2.9 13.3 15.5 -12.9
 Refinancing 10.5 -5.7 3.3 -30.1 17.3 19.7 -52.8
15-Year Mortgage Effective Interest Rate (%) 3.55 3.59 3.60 3.16 (May '16) 3.22 3.37 3.54
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