Mortgage Applications Fail to Spring Forward
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.
For the week ending March 6th, the composite mortgage application index, which includes both home purchase mortgages and refinancings, declined 1.3% as compared to a 0.1% increase for the prior week. The decrease in composite index was driven by a 3.0% decline in the refinance index which reversed a 1.0% gain for the prior week. Purchase applications increased a modest 2.0% as compared to the 0.2% decline for the prior week. Interest rates reversed course with the average interest rate for conforming loans (mortgage amount less than $417,000) increasing to 4.01% as compared to 3.96% for the prior week. The latest mortgage applications index report reinforces that the mortgage and real estate markets continue to be stuck in neutral. (Source: Bloomberg)
What it Means for Mortgage Borrowers
As has been the case for the past six weeks, the mortgage application index report failed to generate much excitement in the real estate and mortgage markets. The uptick in purchase application activity was a positive but neither the purchase or refinance mortgage markets can seem to generate any real momentum. While the increase in interest rates is a negative for mortgage borrowers, the lack of application activity should make lenders hungrier for your mortgage business. Although interest rates rose slightly on the week, they continue to be relatively low and now may be a good time to start the home buying process or refinance your mortgage. If you are a prospective home buyer, use our Mortgage Selector Calculator to determine what size mortgage you qualify for and the mortgage program that is right for you. If you have a mortgage, use our Refinance Calculator to determine how much money you can save by refinancing your existing mortgage. Although mortgage application activity is sluggish, now may be the time for you to make your mortgage move.
The FREEandCLEAR Mortgage Expert
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