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Economy in Brief

U.S. Mortgage Loan Applications Continue To Track Sideways
by Tom Moeller  August 20, 2014

The Mortgage Bankers Association reported that their total Mortgage Market Volume Index improved 1.4% last week (-24.0% y/y) after the prior week's 2.7% decline. Applications remained two-thirds below the peak in September 2012. Applications to refinance an existing loan improved 2.7% (-31.4% y/y) and reversed much of the prior week's decline. Home purchase applications slipped 0.4% (-11.2% y/y), off for the third straight week.

The effective interest rate on a 15-year mortgage slipped to 3.52%, down from the 3.80% high averaged from July to September last year. The effective rate on a 30-year fixed rate loan also slipped to 4.36%, down versus last year's high of 4.79%. The rate on a Jumbo 30-year loan fell to 4.24%. For adjustable 5-year mortgages, the effective interest rate declined sharply to 3.26% from the 3.45% high two weeks ago and was off versus last year's 3.58% peak.

The average mortgage loan size slipped to $244,200. For home purchases, the average loan size fell w/w to $269,200 but for refinancings it rose w/w to $223,900.

Applications for fixed interest rate loans declined 25.2% y/y while adjustable rate loan applications were off by 5.5% 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.

FedViews on the current economy and the outlook from the Federal Reserve Bank of San Francisco is available here.

MBA Mortgage Applications (SA, 3/16/90=100) 08/15/14 08/08/14 08/01/14 Y/Y% 2013 2012 2011
Total Market Index 342.4 337.7 347.0 -24.0 616.6 813.8 572.3
 Purchase 164.1 164.8 166.5 -11.2 197.5 187.8 182.6
 Refinancing 1,358.0 1,322.2 1,377.0 -31.4 3,070.0 4,505.0 2,858.4
15-Year Mortgage Effective Interest Rate (%) 3.52 3.56 3.58 3.80
3.42 3.25 3.97
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