After previously doubling week-to-week, mortgage application volume cooled slightly, the MBA said today.
Home loan apps dipped 7.1 percent on a seasonally adjusted basis for the week ending December 5, but still increased 32.7 percent on an unadjusted basis compared to the holiday-shortened Thanksgiving week.
Compared to the same period last year, volume was up 2.2 percent.
The slowdown was led by a 21.3 percent decrease in FHA lending and a 17.4 percent fall in purchase activity.
Despite refinance activity falling 0.9 percent from the prior week, the refinance share of activity increased to 73.7 percent of total applications from 69.1 percent.
Interest rates, which had previously plummeted, slowed little movement week to week, and certainly hadn’t yet fallen to 4.5 percent.
The 30-year fixed averaged 5.45 percent, down from 5.47 percent, while the 15-year slipped four basis points to 5.09 percent.
Moving in the opposite direction was the one-year ARM, which increased 15 basis points to 6.76 percent.
That may explain why adjustable-rate mortgages accounted for just 1.1 percent of total applications, down from 1.4 percent a week earlier.
The MBA’s weekly survey, compiled since 1990, covers roughly half of all retail mortgage originations, but doesn’t take into account duplicate or denied applications.
While application volume has surged recently, stringent guidelines and home values that simply aren’t there will result in a larger proportion of declined applications.
Related Topics:
