Consumer loan applications rose 3 percent week over week while mortgage rates eased but remained down 39 percent from the same time last year.
In these moments, it’s time to double down – on your skills, on your knowledge – on you. Join us August 8-10 at Inman Connect Las Vegas to embrace change and learn from the best. Get your ticket now for the best price.
Homebuyer demand for mortgages picked up last week as rates continued to fall from their 2022 highs, according to a survey by the Mortgage Bankers Association.
The MBA Weekly Mortgage Applications Survey shows applications for the purchase of mortgages grew by 3 percent last week compared to the week before, but fell 39 percent from the same period in last year. This is the second consecutive week of growth in loan demand, after a 25 percent jump in applications during the week ending January 13.
While applications for refinancing were up 15 percent from week to week, repair applications were down 77 percent from last year. Refi applications accounted for 31.9 percent of all mortgage applications, while adjustable rate mortgages (ARM) accounted for 6.5 percent of all loan applications.
“Mortgage rates have declined for three straight weeks, which is good news for home buyers looking ahead to the spring housing market,” said MBA Chief Economist Joel Kan. in a information. “Mortgage rates across many loan types decreased last week and the 30-year fixed rate hit its lowest level since September 2022 at 6.2 percent.”
Mortgage rates retreat from 2022 highs
According to mortgage loan data tracked by Optimal Blue which is updated daily, rates on mortgages with a 30-year fixed rate reached a 2022 high of 7.16 percent on October 24.
“Housing remains relatively stable, but if housing prices continue to decline, we expect to see buyers return to the market,” Kan said. “Many have been waiting for the cheap challenges to subside.”
For the week ending January 20, MBA reported average rates for the following types of loans:
- For a 30-year fixed-rate suitable mortgage (loan balance of $726,200 or less), rates were taken to 6.20 percent, down from 6.23 percent the week before. Although the score increased to 0.69 from 0.67 (including the origination fee) for the 80 percent loan-to-value ratio (LTV), the quality ratio also decreased.
- Plan for 30-year fixed-term jumbo mortgage (loan balances greater than $726,200) averaged 5.92 percent, down from 6.08 percent the week before. Although the score increased to 0.41 from 0.40 (including the origination fee) for 80 percent LTV loans, the effective ratio also decreased.
- For a 30-year fixed-rate FHA mortgage, rates averaged 6.22 percent, down from 6.26 percent the week before. Although scores increased to 1.10 from 1.05 (including origination) for 80 percent LTV loans, the quality ratio also decreased.
- Price for 15 year fixed rate mortgage average 5.54 percent, down from 5.58 percent the week before. With the score reduced to 0.51 from 0.54 (including the origination fee) for 80 percent LTV loans, the effective ratio also decreased.
- For 5/1 ARM, average rate 5.44 percent, from 5.31 percent the week before. With the score increasing to 0.83 from 0.74 (including the origination fee) for 80 percent LTV loans, the effective ratio also increased.
To them latest newsFannie Mae economists say they expect housing prices to fall this year to set the stage for a mortgage slump and a recovery in sales, but not until 2024.
Get the Inman’s Additional Credit Information sent directly to your mailbox. A weekly roundup of all the big news in the world of mortgages and foreclosures delivered every Wednesday. Click here to register.