HW Media connects and informs decision makers across the housing economy. Professionals rely on HW Media for breaking news, reporting, and industry data and rankings. Moving the Housing Market Forward.

Mortgage apps decline 7.2% with a lower appetite for refis

Refinance applications decreased 14.8% in one week and 40.7% year-over-year, MBA survey finds

Mortgage applications declined 7.2% for the week ending Nov. 26, reflecting a lower appetite for refinances, according to the Mortgage Bankers Association (MBA) survey published on Wednesday.

The drop was mainly driven by the refinance index declining by 14.8% from the previous week, on a seasonally adjusted basis. Concurrently, the purchase index grew by 5.1% from the week prior.

However, mortgage applications declined across the board in comparison to a year ago. The overall market composite index dipped 29.6% on a seasonally adjusted basis. Refinance apps fell 40.7% year over year, and purchase apps decreased 9.4% in the same period.

Joel Kan, the MBA’s associate vice president of economic and industry forecasting, said mortgage rates rose for the third week in a row, reducing incentives for many borrowers to refinance. “Over the past three weeks, rates are up 15 basis points, and refinance activity has declined over 18%,” he said.

Regarding purchase activity, he said the increase in applications was driven by a 6% growth in conventional loans apps, which tend to be larger than government loans. The average loan amount increased to $414,700, the highest since February.  

The trade group estimates the average contract 30-year fixed-rate mortgage for conforming loans ($548,250 or less) increased to 3.31%, seven basis points higher than the previous week. For jumbo mortgage loans (greater than $548,250), it went to 3.27% from 3.28%.

Refinances represented 59.4% of total applications, down from 63.1% the previous week. VA loans consisted of 10% of the share, decreasing three basis points. Meanwhile, FHA loans went from 8.6% to 8.9% in the period. The USDA share was at 0.5% of the total.

Leave a Reply

Your email address will not be published.

Most Popular Articles

3d rendering of a row of luxury townhouses along a street

Log In

Forgot Password?

Don't have an account? Please