Wednesday, November 04, 2020

MBA: Mortgage Applications Increase in Latest Weekly Survey

by Calculated Risk on 11/04/2020 07:00:00 AM

From the MBA: Mortgage Applications Increase in Latest MBA Weekly Survey

Mortgage applications increased 3.8 percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending October 30, 2020.

... The Refinance Index increased 6 percent from the previous week and was 88 percent higher than the same week one year ago. The seasonally adjusted Purchase Index decreased 1 percent from one week earlier. The unadjusted Purchase Index decreased 3 percent compared with the previous week and was 25 percent higher than the same week one year ago.

“Mortgage rates continue to hover at record lows this fall. The 30-year fixed mortgage rate remained essentially unchanged at 3.01 percent last week, but rates for 15-year fixed-rate loans, FHA loans and jumbo loans all fell to new MBA survey lows,” said Joel Kan, MBA’s Associate Vice President of Economic and Industry Forecasting. “The drop in rates spurred an uptick in demand for refinances. Activity increased over 6 percent, with borrowers notably seeking conventional and government loans. After a solid stretch of purchase applications growth, activity decreased for the fifth time in six weeks, but was still over 25 percent higher than a year ago, and has increased year-over-year for six straight months. 2020 continues to overall be a strong year for the housing market.”
...
The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($510,400 or less) increased to 3.01 percent from 3.00 percent, with points increasing to 0.38 from 0.35 (including the origination fee) for 80 percent loan-to-value ratio (LTV) loans.
emphasis added
Mortgage Refinance IndexClick on graph for larger image.


The first graph shows the refinance index since 1990.

The refinance index has been very volatile recently depending on rates and liquidity.

But with record low rates, the index remains up significantly from last year.

Mortgage Purchase Index The second graph shows the MBA mortgage purchase index

According to the MBA, purchase activity is up 25% year-over-year unadjusted.

Note: Red is a four-week average (blue is weekly).