MBA: Mortgage applications fall 2.5%

Mortgage apps reach lowest level since April 2018

Mortgage applications continued to retreat further for the week ending Feb. 1, 2019, according to the newest data from the Mortgage Bankers Association's weekly Mortgage Applications Survey.

MBA Vice President of Economic and Industry Forecasting Joel Kan said mortgage rates for all loan types declined last week, with the 30-year fixed mortgage rate falling seven basis points to 4.69% – the lowest rate since April 2018.

On an unadjusted basis, the Market Composite index declined 2.5% from the previous week.

“Despite more favorable borrowing costs, and after a three-week surge in activity, purchase applications have slowed over the past two weeks, and are now almost 2% lower than a year ago,” Kan continued. “However, moderating price gains and the strong job market, including evidence of faster wage growth, should help purchase growth going forward.”

Furthermore, Kan added refinance applications saw a very slight increase compared with the previous week, despite the broad decline in rates.

The Refinance Index slightly increased 0.3% from the previous week while the unadjusted Purchase Index climbed 13% from a week ago, but is 2% lower than the same week in 2018. The seasonally adjusted Purchase Index retreated 5% from the week before.

The refinance share of mortgage activity retreated to 41.6% of total applications, falling from 42% the previous week.

The adjustable-rate mortgage share of activity slid to 7.8% of total applications.

The Federal Housing Administration's share of mortgage apps held steady from last week’s 10.5% and the Veterans Affairs' share of applications fell from 10.7% the previous week to 10% this week.

The Department of Agriculture's share of total applications moved forward from 0.4% last week to 0.5% this week.

The MBA reported that mortgage interest rates for 30-year fixed-rate mortgages with conforming loan balances ($484,350 or less) declined from the previous week, retreating from 4.76% to 4.69%.

The average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances (greater than $484,350) decreased from last week’s 4.6 to 4.5% this week.  

The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA fell to 4.70% this week from 4.77% last week.

The average contract interest rate for 15-year fixed-rate mortgages decreased from 4.16% last week to 4.11% this week.

Lastly, the average contract interest rate for 5/1 ARMs moved backwards to 4.04%, from 4.14% last week. 

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