The volume of mortgage applications continued to decline during the week ended March 26. The Mortgage Bankers Association (MBA) said its Composite Market Index, a measure of that volume, fell 2.2% on a seasonally adjusted basis from the previous week and was down 2%. on an unadjusted basis. It was the tenth time the index had declined in 13 weeks since the start of 2021.
The The refinancing index fell by 3% compared to the previous week and was 32% lower than the same week a year ago. Refinancing, however, still accounts for the lion’s share of claims, 60.6% during the week, down slightly from the week ended March 19.
Seasonally adjusted The purchase index fell by 2% a week earlier. Unadjusted, the index fell 1 percent and was 39 percent higher than the same week a year ago.
Refi index vs 30 years Fixed
Buy index vs 30 years fixed
“After seven consecutive weeks of increasing mortgage rates, the 30-year fixed rate has fallen 3 basis points to 3.33%, which is still almost half a percentage point higher than at the start of this year. but purchasing activity was still convincingly higher than the pandemic-induced decline seen a year ago, as well as a 6% increase from the same week in March 2019, ”said Joel Kan, associate vice president of economic and industrial forecasting at the MBA. “Many potential buyers are feeling the effects of rising rates and rapidly accelerating home prices this spring. Record high inventory is pushing home prices at twice the rate of a year ago, and even above the 10% growth rates seen in 2005. The housing market is in desperate need of more inventory to slow price growth and maintain affordability. ”
The FHA share of total requests
decreased from 11.3 percent to 11.3 percent while the share of VA fell from 9.8 percent to 10.3 percent. USDA’s share was unchanged at 0.4%. The average loan balance for all loans decreased from $ 333,000 the previous week to $ 324,800. Purchase loan balances were also lower than the week before, $ 401,400 compared to $ 409,300.
The average contractual interest rate for 30-year fixed rate mortgages (FRMs) with balances at or below the compliant limit of $ 548,250, decreased to 3.33% from 3.36%, with points falling from 0.42 to 0.39. The workforce fell to 3.44 percent. .
The average contractual interest rate for 30-year jumbo FRMs, loans with balances above the compliant limit, fell from 3.40% to 3.34%. with points decreasing to 0.31 from 0.43. The effective rate was 3.43%.
The FHA-backed 30-year FRM had an average rate of 3.29%, down from 3.35% the week before. The points were reduced from 0.41 to 0.34 and the effective rate was reduced to 3.39%.
The 15-year fixed-rate mortgage rate fell 1 basis point to 2.71% and 0.40 to 0.33 points. The effective rate was 2.80 percent.
The average contractual interest rate for 5/1 variable rate mortgages has increased from 2.79% to 2.85%, with points decreasing to 0.40 from 0.44. The effective rate rose to 3.0%. The ARM share of all apps rose to 3.4% from 3.2% the week before.
The MBA Weekly Mortgage Applications Survey has been conducted since 1990 and covers over 75 percent of all personal loan applications in the United States. The base period and value of all indices are March 16, 1990 = 100 and interest rate information is based on loans with 80% loan-to-value ratio and points that include origination charges .
MBA said its latest forbearance and call volume survey showed a Reduction of 9 basis points in the total number of loans currently withheld. As of March 21, there were about 2.5 million owners in the plans, 5.05 percent of the total service agent portfolios. By stages, 13.8% of the total forbearance loans are at the initial stage of the forbearance plan, while 83.4% are in extension forbearance. The remaining 2.8 percent is income from abstention.
The share of Fannie Mae and Freddie Mac loans in forbearance fell to 2.77 percent – an improvement of 6 basis points. Ginnie Mae’s (VA / FHA) forbearance loans fell 20 basis points to 6.83%, while the forbearance share for portfolio loans and private label (PLS) securities fell by 1 basis point at 8.90%. The percentage of forbeared loans by independent mortgage bank (IMB) services fell 14 basis points to 5.23%, and those managed by depository services fell 5 basis points to 5.10%.
“The share of loans in forbearance fell for the fourth week in a row, falling below 5% for the first time in a year. New forbearance requests remained at their lowest level since last March and the pace of exits has increased, ”said Mike Fratantoni, Senior Vice President and Chief Economist of MBA. “Over 17% of borrowers benefiting from forbearance extensions have now passed the 12-month mark.”
Fratantoni added: “Many owners need this support, although there are more and more signs that the pace of economic activity is accelerating as vaccine deployment continues. Those who have continued difficulties due to the pandemic and wish to extend their forbearance beyond the 12 month point should contact their service agent. Agents cannot automatically extend forbearance conditions without the borrower’s consent. “
MBA’s latest forbearance and call volume survey covers the period March 15 to March 21, 2021 and accounts for 74% of the first mortgage services market (37.1 million loans).