Applications for U.S. home loans rose in the latest week as demand for refinancing outpaced purchases, data from an industry group showed on Wednesday.

The Mortgage Bankers Association said its seasonally adjusted index of mortgage application activity, which includes both refinancing and home purchase demand, rose 1.3 percent in the week ended Oct. 4. That follows a dip of 0.4 percent in the week ended Sept. 27.

The figures come as a U.S. federal government shutdown has cast a spotlight on fiscal policy, with some economists worrying that the stalemate in Congress could drag on the economy.

MBA data showed 30-year mortgage rates slipped 7 basis points to 4.42 percent, after in September matching the 4.8 percent high for 2013.

The refinancing index gained 2.5 percent after recently hitting the lowest level since June 2009. The index is now at its highest since early August.

The mortgage survey covers over 75 percent of U.S. retail residential mortgage applications, according to MBA.

Source: http://www.cnbc.com/id/101098130
Follow me:

• James Clooney | Carbonmade.com
• James Clooney - Magnt
• James Clooney on Gather
• James Clooney - Listal
• James Clooney's Blog
• James Clooney | WordPress
• James Clooney on Quora
• James Clooney's Twitter Page

After weeks of declining numbers, slightly lower interest rates apparently spurred a modest bounce in applications for mortgage refinancing.  The Mortgage Bankers Association (MBA) said that its refinancing index which measures application volume rose by 2 percent during the week ended August 30 and the refinancing portion of all applications increased to 61 percent from 60 percent a week earlier.




Applications for purchase mortgages however fell slightly.  The seasonally adjusted Purchase Index decreased 0.4 percent from the week ended August 23, and the unadjusted Purchase Index decreased 3 percent.  The unadjusted index was 6 percent higher than the same week in 2012.  MBA's Market Composite Index, a measure of overall application activity, increased 1.3 percent on a seasonally adjusted basis from the week before and 0.3 percent on an unadjusted basis. 




MBA said that 38 percent of refinancing applications were for the Home Affordable Refinance Program (HARP) compared to 35 percent the week before.  This was the highest share for HARP since MBA began tracking the program in 2012.




Both contract and effective interest rates fell during the week.  The average contract rate for a 30-year fixed-rate mortgage (FRM) with a conforming balance of $417,000 or less decreased to 4.73 percent from 4.80 percent and points decreased to 0.33 from 0.41.  The jumbo 30-year FRM with balances over $417,000 had an average rate of 4.71 percent with 0.25 point compared to 4.78 percent and 0.34 point the previous week.  This was the second week in a row that the jumbo FRM carried a lower rate than the conforming version.




FHA-backed 30-year FRM had an average rate of 4.48 percent, down 4 basis points from a week earlier.  Points decreased to 0.03 from 0.32.




The rate for a 15-year FRM averaged 3.75 percent with 0.30 point during the week.  The previous week the average was 3.84 percent with 0.35 point.




The market share of adjustable rate mortgages (ARM) decreased slightly during the week to 7 percent.  The rate for the most popular ARM, the 5/1 hybrid, decreased 1 basis point to 3.49 percent and points were unchanged at 0.37. 




Mortgage rate quotes are for loans with an 80 percent loan-to-value ratio.  Points include the origination fee.




MBA's Weekly Mortgage Application Survey covers approximately 75 percent of all U.S. retail residential mortgage applications, and has been conducted since 1990. Respondents include mortgage bankers, commercial banks and thrifts. Base period and value for all indexes is March 16, 1990=100.




source: http://www.mortgagenewsdaily.com/09042013_application_volume.asp




mortgage articles at Jim Clooney

 The average 30-year fixed mortgage rate rose to 4.51 percent, a two-year high, on the possibility that the Federal Reserve would reduce future bond purchases, according to Freddie Mac.

The 30-year fixed-rate mortgage averaged 4.51 percent for the week ending July 11, up from last week when it averaged 4.29 percent. Last year at this time, it averaged 3.56 percent.

The 15-year fixed rate mortgage averaged 3.53 percent, up from 3.39 percent last week and 2.86 percent from a year ago.

On Thursday morning, stocks opened at record-high levels after comments Wednesday night from Federal Reserve chairman Ben Bernanke that the Fed intends to keep its $85 billion a month bond purchasing stimulus program in place for the near future. The Dow closed at an all-time high on Thursday. 
 Before Bernanke spoke at a conference at the National Bureau of Economic Research, the Federal Reserve released minutes from its policy committee meetings from June 18 and 19. Those meeting notes indicated many members were waiting for further improvement in the labor market before bond purchases could be slowed.

Last month, Bernanke hinted that the Federal Reserve could begin tapering bond purchases as early as this fall if, among other factors, the country's unemployment situation improved. 

 Frank Nothaft, vice president and chief economist with Freddie Mac, said households were moving into the mortgage-lending market out of fear that interest rates might rise.

Nothaft said June's employment numbers, which indicated a higher than expected 195,000 jobs added last month plus higher revisions for the previous two months, led to more market speculation that the Federal Reserve would reduce future bond purchases. That caused bond yields and mortgage rates to rise, he said.

"Moreover, hourly wages rose by 2.2 percent over the last 12 months and represented the largest annual increase in nearly two years," he said. "However, the minutes of the June 18th and 19th Federal Reserve's monetary policy committee meeting, released July 10th, stated that many members indicated further improvement in the outlook for the labor market would be required before it would be appropriate to slow the pace of bond purchases."

The jobs report indicated part-time jobs increased to more than 350,000, an indication that the quality of jobs did not keep pace with the quantity of jobs added.

When asked if some people are just getting into the market on the fear that mortgage rates will rise further, Zillow senior economist Svenja Gudell said that may be only one part of the story.

"Some of the demand may be pulled forward for those that are already in the process of buying and they might try to speed up closing so they are able to lock-in the lowest rate possible, but it's unlikely that a flood of brand new buyers will enter the market just because mortgage rates are rising," she said.

It's important to remember that mortgage rates are still incredibly low, she said.

"Per Freddie Mac, the average 30-year fixed rate over the past 42 years was roughly 8.5 percent, so anything below 6 percent is a bargain. Also, rates of 6 or even 7 percent won't happen overnight. While it's expected that mortgage rates, in general, will continue to rise, it will take a few years for them to reach that level," she said.

Gudell said some investors are beginning to exit markets due to rising mortgage rates and home values, especially in areas like Phoenix and Las Vegas that have seen above average investor activity. With that view in mind, homebuyers could benefit.

"First-time homebuyers will no longer be pushed out of these markets and have more of a chance to be competitive, avoiding stressful and frustrating bidding wars," she said. 

Source: ABC News

Mortgage applications fell for the fourth straight week as interest rates continued to tick up.

According to the Mortgage Bankers Association (MBA), mortgage applications fell 4% last week after plummeting 11.7% the week before. The Market Composite Index, a measure of mortgage loan application volume, decreased 4.0% on a seasonally adjusted basis from one week earlier. Mortgage applications are now about a third below their level from a year ago.

The decline in mortgage activity is fueled by the rise in interest rates which have reached their highest level since July 2011. The average rate for the 30-year fixed rate-mortgage increased to 4.68% from 4.58% last week. The spike in rates has driven the refinance share of mortgage applications down to 64%.

Mike Fratantoni, MBA's vice president of research and economics, said last week that refinancing applications reached their lowest level in two years. The rate remains unchanged.

According to economists at Contingent Macro Advisors, mortgage activity has fallen 43.6% over the past two months.

"Mortgage applications had been on a rising trend over the past 18 months although there has been substantial week-to-week volatility, but the trend now appears to have topped out and begun a steady retreat," according to a statement from Contingent Macro Advisors.

The adjustable-rate mortgage (ARM) share of activity decreased to 7% of total applications. Despite the rise in rates and declines in applications, the four-year average for home purchases continues to climb since it turned upward in November 2011.

 The total number of mortgage applications filed in the U.S. last week fell 12% from the prior week as interest rates jumped to their highest level in two years, the Mortgage Bankers Association said Wednesday.

The refinance index decreased 16% for the week ended June 28 from the previous week, according to the weekly survey covering more than three-quarters of all U.S. residential-mortgage applications. MBA also reported the seasonally adjusted purchasing index slipped 3% from a week earlier.

Interest rates have increased in recent weeks amid stronger economic data, curbing some individuals' appetite to buy a new home. Mike Fratantoni, MBA's vice president of research and economics, said fewer homeowners have an incentive to refinance at the current interest rates. Refinance-application volume dropped more than 15% last week.

The share of applications filed to refinance an existing mortgages decreased to 64%, the lowest level since May 2011, from the prior week's 67%. Adjustable-rate mortgages, or ARMs, increased to 8% of total applications, the highest level since July 2008. The Home Affordable Refinance Program share of refinance applications rose to 34% from 30% in the prior week.

The average rate on 30-year fixed-rate mortgages with conforming loan balances climbed to 4.58%, the highest rate since October 2011, from the prior week's 4.46%. Rates on similar mortgages with jumbo-loan balances rose to 4.68%, the highest rate since March 2012, from 4.52% a week earlier. The average rate on 30-year fixed-rate mortgages backed by the Federal Housing Administration increased to 4.27%, the highest rate since September 2011, from 4.2% a week earlier.

The average rate for 15-year fixed-rate mortgages climbed to 3.64%, the highest level since July 2011, from 3.55% a week earlier. The 5/1 ARM average rate rose to its highest level since July 2011, jumping to 3.33% from 3.06% a week earlier.

Write to Nathalie Tadena at [email protected]