Mortgage Applications Down, Reach Five-Month Low
Mortgage applications fell for the first time in a month, hitting a five-month low and reflecting a drop in home purchase loan demand, an industry group said Wednesday.
The Mortgage Bankers Association said its seasonally adjusted index of mortgage applications, considered a timely gauge of U.S. home sales, for the week ending July 20 decreased 3.6 percent to 609.0.
That’s the lowest level for the mortgage application index since the week ending February 16, when it stood at 606.6.
The four-week moving average of mortgage applications, which evens out the volatile weekly figures, was down 0.4 percent at 621.6.
Borrowing costs on 30-year fixed-rate mortgages, excluding fees, averaged 6.59 percent, down 0.02 percent.
U.S. mortgage interest rates were also below year-ago levels at 6.69 percent.
The MBA’s seasonally adjusted purchase index fell 5.0 percent to 424.2, its lowest reading since April. The index was above its year-ago level, 389.0.
The group’s seasonally adjusted index of mortgage refinancing applications, meanwhile, decreased 1.4 percent to 1,692.9.
The mortgage refinance share of applications increased to 38.5 percent from 37.7 percent the previous week.
Fixed 15-year mortgage rates, always a popular option for mortgage refinancing, averaged 6.24 percent, down from 6.29 percent.
Rates on one-year adjustable-rate mortgages (ARMs) jumped to 5.62 percent from 5.60 percent, while the ARM share of activity stood at 21.0 percent, unchanged from the previous week.
U.S. housing market industry indexes, in general, tend to be volatile, but recent data suggest a delayed recover for the hard-hit sector.
The MBA’s soft data precedes separate reports this week gauging home sales.
The National Association of Realtors will release data on sales of U.S. existing homes on Wednesday and U.S. Commerce Department homes sales data is set to come out Thursday.
The MBA’s survey covers about 50 percent of all U.S. retail residential home loans. Respondents include mortgage banks, commercial banks and thrifts.
SOURCE: Reuters