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 continues to be on a hot streak, posting back-to-back weekly gains for the first time in several months. For the week ending March 27th, the composite mortgage application index, which includes both home purchase mortgages and refinancings, increased 4.6%, a strong showing following a 9.5% increase for the prior week. Home purchase mortgage applications increased 6.0% as compared to a 5.0% increase the prior week and refinance applications rose 4.0% as compared to a 12.0% jump the prior week. Mortgage applications were boosted by continued low interest rates as the average interest rate for conforming loans (mortgage amount less than $417,000) dropped slightly to 3.89% as compared to 3.90% for the prior week. (Source: Bloomberg)
What it Means for Mortgage Borrowers
Mortgage application activity closed out March on a strong note with gains in both purchase and refinance applications. The increase in purchase activity is especially positive as it shows that home buyers are able to obtain mortgage financing when they find properties they want to buy. Existing homeowners are refinancing their existing mortgages to lock-in low interest rates. If you are thinking about buying a home in the next six months, use the Mortgage Selector Calculator on FREEandCLEAR to determine what size mortgage you can afford and the mortgage program that is right for you. Prospective home buyers should also use our INTEREST RATES function to compare mortgage rates and contact lenders to get pre-approved and gain an advantage when they search for homes.
The FREEandCLEAR Mortgage Expert