Mortgage Applications Fall Back
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 ended November 21st, the composite mortgage application index, which includes both home purchase mortgages and refinancings, decreased 4.3% driven by declines in both purchase and refinance applications.
For the week ended November 21st, the purchase application index declined 10.0% as compared to the prior week, which was up 12.0%. The refinance application index declined 4.0% after increasing a modest 1% in the prior week. The composite index, which includes both purchase and refinance mortgage applications, decreased 4.3% as compared to the prior week, which was up 4.9%. Because it was the week before the Thanksgiving holiday, the decline in mortgage application activity was not unexpected and it is challenging to draw meaningful conclusions from the report. Interest rates remained attractive with the average interest rate for conforming loans decreasing to 4.15%, as compared to 4.18% for the prior week. (Source: Bloomberg)
What it Means for Mortgage Borrowers
It is not unsurprising for application activity to decline the week before a holiday but the trend for the past month as compared to the prior year has been negative. With interest rates remaining low it will be interesting to see if mortgage application activity picks up in December. This is typically a slow time of year for purchase activity but existing home owners may want to refinance to lock in low interest rates before the end of the year. Use the INTEREST RATES feature on FREEandCLEAR to view rates for lenders in your area and then use our Refinance Calculator or Mortgage Qualification Calculator to assess if now is a good time for you to refinance your mortgage or buy a home.
The FREEandCLEAR Mortgage Expert
%