According to the Mortgage Bankers Association’s Weekly Applications Survey, average mortgage rates increased last week from the previous week. Rates were up on 30-year fixed-rate loans with conforming balances, loans backed by the Federal Housing Administration, and 15-year fixed-rate mortgages. Jumbo loans, on the other hand, saw a slight decrease. The change in rates was enough to send mortgage application demand downward, however. In fact, the total number of requested applications for mortgage loans fell 6.2 percent, mainly due to a drop in refinance activity. Michael Fratantoni, MBA’s chief economist, told CNBC borrowers with larger loans are more sensitive to mortgage rate changes. “The decline in the average loan size for both purchase and refinance applications last week showed again that borrowers with larger loans are much more sensitive to a given change in rates,” Fratantoni said. “The slight uptick led to a fairly sharp weekly drop in refinance volume, and purchase volume slipped as well.” The MBA’s weekly survey has been conducted since 1990 and covers 75 percent of all retail residential mortgage applications. More here.
