US mortgage applications fall 2.9%

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Mortgage applications in the US declined last week despite the easing of interest rates, according to the latest Mortgage Bankers Association (MBA) survey, which covers more than 75 percent of the country’s retail residential mortgage applications.

MBA’s index of mortgage application activity dropped 2.9 percent on a seasonally adjusted basis in the week ended 27 January. This includes both home purchase demand and refinancing.

The index of refinancing applications fell 3.6 percent on a seasonally adjusted basis while the index of mortgage requests for home purchases dropped 1.7 percent.

The refinance share of total mortgage activity slid from 81.3 percent to 80.0 percent.

Despite the decline in the volume of mortgage applications for the week, the refinance volume remains high; with survey respondents stating that 10 percent of activity was contributed by the government’s expanded Home Affordable Refinance Programme (HARP).

Fixed 30-year mortgage rates averaged 4.09 percent, a decrease of two basis points from 4.11 percent in the previous week.

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