At FREEandCLEAR, we follow the Mortgage Bankers’ Association (MBA) mortgage applications index which measures both purchase and refinance applications for mortgage lenders across the country. An increase in the MBA applications index reflects an increase in mortgage applications while a decrease in the index reflects a decline in mortgage applications.
The mortgage applications index dipped slightly for the week ended April 24th. Home purchase mortgage applications were unchanged for the week after increasing 5.0% for the prior week. The refinance applications index decreased 4.0% after increasing 1.0% for the prior week. The composite mortgage application index, which includes both home purchase mortgages and refinancings, decreased 2.3%, reversing a 2.3% increase for the prior week. Despite the pullback in application activity for the current week, the mortgage application index has increased four of the past six weeks, showing the overall strength of the mortgage market. Low interest rates continue to be a key driver of the real estate and mortgage markets. Mortgage rates remained attractive as the average interest rate for conforming loans (mortgage amount less than $417,000) increased slightly to 3.85% as compared to 3.83% for the prior week. (Source: Bloomberg)
What it Means for Mortgage Borrowers
With the strong performance of the mortgage application market over the past month and a half you are bound to see some up and down fluctuations in the index from week to week. After increasing the prior week, purchase mortgage applications remained unchanged for the current week demonstrating that home buyers are able to obtain mortgage financing for their purchases. Attractive interest rates continue to pull prospective buyers off the sidelines and into the marketplace. Although refinance applications dropped for the current week, low rates mean that current homeowners should evaluate if now is the right time to refinance. Prospective home buyers can use the Mortgage Selector Calculator on FREEandCLEAR to determine what size mortgage they can afford and the mortgage program that is right for them. Current home owners can use our Refinance Calculator to determine how much money you can save by refinancing. And both prospective and current home owners can use the INTEREST RATES feature on FREEandCLEAR to compare mortgage rates and fees for lenders in their area.
The FREEandCLEAR Mortgage Expert