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Economy in Brief

U.S. Mortgage Loan Applications Reflect Strong Crosscurrents
by Tom Moeller  November 22, 2017

The Mortgage Bankers Association reported that its total Mortgage Applications Volume Index rose 0.1% last week, down 12.6% y/y. Moving in the opposite direction, however, were purchase applications, which jumped 5.3% (2.7% y/y) following minimal increases in the prior two weeks. This gain was offset by a 4.8% decline (-25.5% y/y) in applications to refinance, which were down by one quarter y/y.

The effective interest rate on a 15-year mortgage of 3.66% was little changed w/w at the highest level since July. Rates were up from 3.40% in mid-September. The effective rate on a 30-year fixed-rate loan gained w/w to 4.32%. The rate on a Jumbo 30-year loan increased to 4.25%. For adjustable 5-year mortgages the effective interest rate eased to 3.45%, but still was higher than the 3.25% September low.

The average mortgage loan size rose to $289,000, up 4.7% y/y. For purchases, the average loan size increased to $320,800 (3.4% y/y); for refinancings, it fell to $257,000 (2.2% y/y).

Applications for adjustable rate loans rose 8.8% y/y, while applications for fixed rate loans fell 13.8% 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) 11/17/17 11/10/17 11/03/17 Y/Y 2016 2015 2014
Total Market Index 0.1 3.1 -0.0 -12.6 15.6 17.9 -41.4
 Purchase 5.3 0.4 0.5 2.7 13.3 15.5 -12.9
 Refinancing -4.8 6.3 -0.5 -25.5 17.3 19.7 -52.8
15-Year Mortgage Effective Interest Rate (%) 3.66 3.64 3.62 3.33 (Nov. '16) 3.22 3.37 3.54
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