Mortgage application volume slipped 8.2 percent on a seasonally adjusted basis for the week ending January 2, the MBA said today.
On an unadjusted basis, the home loan application index fell 8.9 percent compared to the previous week, but was still up 28.3 percent compared to the same period a year earlier.
The refinance index decreased 12.3 percent, indicating that borrowers may be holding out for even lower interest rates, which seem to be inevitable at this point.
Meanwhile, FHA lending jumped 19.2 percent as purchase activity increased 7.3 percent.
The refinance share of mortgage activity fell to 79.8 percent of total applications, down from 82.9 percent a week earlier as interest rates were mixed.
The popular 30-year fixed-rate mortgage increased four basis points to 5.07 percent, while the 15-year fixed slipped 12 basis points to 4.67 percent.
The one-year ARM fell to 5.90 percent from 6.15 percent, but still far out prices fixed rate alternatives, which may explain the meager 0.9 percent ARM-share of total applications.
Look for interest rates to keep heading south, though as many have mentioned before, qualifying this time around is a lot tougher, what with tighter guidelines and falling home prices.
Not to mention all those millions of borrowers with negative equity who can’t tap into these low rates, which makes the whole thing look more and more like a homebuilder bailout.
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