Mortgage applications up after interest rate falls – RISMedia

Mortgage applications rose 2.0% for the week ended December 3, 2021, according to data from the Mortgage Bankers Association (MBA) weekly mortgage application survey.

The results:

  • The Market Composite Index, a measure of the volume of mortgage loan applications, rose by a seasonally adjusted 2.0% compared to the previous week.
  • Unadjusted, the index rose 45% compared to the previous week.
  • The refinancing index rose compared to the previous week by 9% – 37% lower year-on-year.
  • The seasonally adjusted purchasing index fell by 5% compared to the previous week.
  • The unadjusted purchase index rose 28% from the previous week – 8% lower year-on-year.
  • The refinancing share of the mortgage business rose to 63.9% of the total applications.
  • The proportion of adjustable rate mortgages (ARM) in activity decreased to 3.0% of total claims.
  • The share of the FTA in the total applications rose to 9.9% compared to the previous week.
  • The VA share in the total applications rose to 10.7% compared to the previous week.
  • The USDA’s share of total applications was unchanged from 0.5 percent the previous week.

Take away:

“Mortgage rates fell for the first time in a month, causing refinancing to pick up, with government refinancing up more than 20% over the week. While the 30-year fixed-rate mortgage rate and 15-year fixed-rate mortgage rate both fell by just one basis point, the FHA rate fell by 7 basis points, which fueled the rise in government refinancing. Borrowers continue to take advantage of these opportunities, but if interest rates rise as the MBA predicts, the refinancing window will continue to narrow, ”said Joel Kan, MBA’s associate vice president of economic and industry forecasting, in a statement.

“The buying market was slower last week, with requests falling after four increases in a row. Activity is still near its highest level since March 2021, which is a positive sign for the end of the year, ”he added. “Buying activity continues to be constrained by a shortage of inventory combined with rapid increases in home prices and mortgage rates higher than in 2020.”

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