After several consecutive weeks of mortgage records showing lowering interest rate averages nationwide, the volume of home loan application submissions has exhibited repeated rises. As conditions continue to favor consumers, a growing number of individuals considering homeownership may be looking into obtaining residential financing.
Within the Mortgage Bankers Association's (MBA) latest Weekly Mortgage Applications Survey, it was reported a significant increase in loan applications was observed during the week ending May 3. According to the organization's Market Composite Index, week-over-week improvement of 7 percent was recently exhibited on both seasonally adjusted and unadjusted bases. The seasonally adjusted Purchase Index showed an uptick of 2 percent, moving the reading to the highest level seen since May 2010. The unadjusted Purchase Index also experienced a hike, improving by 3 percent form the preceding week and registering at a rate 12 percent higher than that logged during the same time prior year.
Contract interest rates for average 30-year fixed-rate mortgages (FRMs) with conforming balances up to $417,500 dropped slightly to 3.59 percent last week - to the lowest rate on record since December 2012 - from its previous position at 3.60 percent. Average 15-year FRM contract interest rates also declined, to 2.81 percent, from the former week's reading of 2.84 percent. This development saw the product's rate reach the lowest level noted in the history of the survey. Also moving down to all-time low rates were the average contract interest rates for five- and one-year adjustable-rate mortgages. The popular short-term products were seen at 2.53 percent last week, exhibiting a drop from the level of 2.55 percent which was noted the week before.
Additionally, the MBA reported its Refinance Index jumped 8 percent last week, citing increases in both the conventional and government refinance indices as possible reasons. The refinance share of mortgage activity increased to 76 percent of total applications - the highest level since February 2013 - from the reading of 75 percent observed the preceding weeks.
FHFA announce refinance volume strong in 2013, HARP extension
The Federal Housing Finance Agency (FHFA) announced refinance volumes remained at high levels during the month of February, as national mortgage rate averages hovered near record lows. The organization noted that more than 463,000 loan refinances took place during the 28-day period, with almost 98,000 having been completed through the Home Affordable Refinance Program (HARP).
Lending companies may be feeling an increased sense of safety and soundness recently, as the program has helped more than 2.3 million homeowners refinance existing loans and avoid foreclosure since its inception in April 2009.