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Economy in Brief

U.S. Mortgage Applications Decline; Interest Rates Rise Slightly
by Tom Moeller  December 18, 2019

The Mortgage Bankers Association reported that its Mortgage Loan Index declined 5.0% (+55.0% y/y) in the week ending December 13 after increasing 3.8% in the previous week. Applications to refinance a loan fell 6.5% (+135.4% y/y) after an 8.7% gain in the prior week. Purchase applications declined 2.1% w/w (+10.1% y/y) following a 0.4% dip.

The effective interest rate on a 15-year fixed-rate mortgage of 3.46% compared to 3.44% in the prior week. This remained below its high of 4.71% reached early in November 2018. The effective rate on a 30-year fixed-rate loan edged up to 4.08% from 4.07%. The effective rate on a 30-year Jumbo mortgage rose to 4.04%. The rate on an adjustable 5-year mortgage declined to 3.37%, is lowest level in two months.

The average mortgage loan size fell to $308,700 (+3.3% y/y) from $314,100 in the previous week. The average loan size for purchases rose to $328,200 from $325,200. For refinancings, the average loan size declined to $296,900 from $307,500.

Applications for fixed-rate loans rose 60.5% y/y. Adjustable rate loan applications declined 8.7% 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 each index 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) 12/13/19 12/06/19 11/29/19 Y/Y 2018 2017 2016
Total Market Index -5.0 3.8 -9.2 55.0 -10.4 -17.8 15.6
  Purchase -2.1 -0.4 0.9 10.1 2.1 5.6 13.3
  Refinancing -6.5 8.7 -15.6 135.4 -24.3 -34.0 17.3
15-Year Mortgage Effective Interest Rate (%) 3.46 3.44 3.44 4.45 (Dec'18) 4.35 3.59 3.22
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