Home Loan Applications Drop 7.3 Percent Last Week after decreasing 4.0 percent the week before.
Dennis Norman
The Mortgage Bankers Association (MBA) released its weekly mortgage applications survey for the week ending February 19, 2010. The report showed the MBA Purchase Index (a measure of the volume of loan applications related to a home purchase) decreased 7.3 percent from the week before and the four-week moving average for the index is down 2.1 percent showing a downward trend in homebuyer activity.
“As many East Coast markets were digging out from the blizzard last week, purchase applications fell, another indication that housing demand remains relatively weak,” said Michael Fratantoni, MBA’s Vice President of Research and Economics. “With home prices continuing to drift amid an abundant inventory of homes on the market, potential homebuyers do not see any urgency to lock in purchases.”
Interest rates and fees for the week:
- 30 year fixed-rate mortgage interest rates increased back above the 5 percent mark hitting 5.03 percent, up from 4.94 percent, with fees increasing as well to 1.34 percent from 1.09 percent on loans that are 80 percent of the value of the home.
- 15 year fixed rate mortgage interest rates increased slightly to 4.35 percent from 4.33 percent, with fees increasing significantly to 1.31 percent from 1.02 percent on loans that are 80 percent of the value of the home.
- One-year ARM interest rates increased to 6.80 percent from 6.67 percent with fees increasing to 0.33 percent from 0.32 percent for loans that are 80 percent of the value of the home.
I don’t know if these increases to interest rates can be attributed to this or not, but in an article, Robert Fishel points out that the indication the Fed Reserve will stop buying mortgage backed securities toward the end of this quarter will most likely cause an increase in mortgage interest rates: Yet another blow to the housing market, if it happens.
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