MBA: Substantial drops in mortgage purchases, refinances

Mortgage requests during the week ending January 20 dipped considerably from the week before, the Mortgage Bankers Association reports, with nearly an equal drop in refinancing and purchasing activity.

Mortgage requests during the week ending January 20 dipped considerably from the week before, the Mortgage Bankers Association reports, with nearly an equal drop in refinancing and purchasing activity.

According to the MBA's Weekly Mortgage Applications Survey, the Market Composite Index fell 5 percent week-to-week. The Refinance and Purchase indices dropped 5.2 and 5.4 percent, respectively.

Refinancing activity still made up a considerable portion of total home loan applications during the week. The report shows 81.3 percent of mortgage requests were for refinances, which is down marginally from 82.2 percent a week earlier.

While mortgage records indicate many homeowners nationwide have refinanced or altered their home loans in recent months, thanks in large part to affordable rates, numerous housing analysts maintain more government programs are needed to help homeowners behind on monthly payments.

In his State of the Union speech, President Barack Obama stated he intends to propose legislation that could help homeowners refinance their mortgages into ones insured by the Federal Housing Administration.

"I'm sending this Congress a plan that gives every responsible homeowner the chance to save about $3,000 a year on their mortgage, by refinancing at historically low interest rates," the president said in his speech.



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