Residential Real Estate News
Mortgage Applications Spike in U.S. in Late January
According to the Mortgage Bankers Association's latest Weekly Mortgage Applications Survey for the week ending January 28, 2022, U.S. mortgage applications increased 12.0 percent from one week earlier.
The Market Composite Index, a measure of mortgage loan application volume, increased 12.0 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index increased 15 percent compared with the previous week.
The Refinance Index increased 18 percent from the previous week and was 50 percent lower than the same week one year ago. The seasonally adjusted Purchase Index increased 4 percent from one week earlier. The unadjusted Purchase Index increased 12 percent compared with the previous week and was 7 percent lower than the same week one year ago.
"Most mortgage rates in MBA's survey continued to rise, with the 30-year fixed rate reaching its highest level since March 2020 at 3.78 percent. Despite the increase in rates, refinance applications were up 18 percent, driven mainly by a 22 percent jump in conventional applications. There has likely been some recent volatility in application counts due to holiday-impacted weeks, as well as from borrowers trying to secure a refinance before rates go even higher," said Joel Kan, MBA's Associate Vice President of Economic and Industry Forecasting. "Purchase applications also increased in the final full week of January but remained 7 percent lower than a year ago. The average purchase loan size hit a new survey high once again at $441,100. Stubbornly low inventory levels and swift home-price growth continue to push average loan sizes higher."
The refinance share of mortgage activity increased to 57.3 percent of total applications from 55.8 percent the previous week. The adjustable-rate mortgage (ARM) share of activity increased to 4.5 percent of total applications.
The FHA share of total applications decreased to 7.7 percent from 8.6 percent the week prior. The VA share of total applications decreased to 9.1 percent from 9.9 percent the week prior. The USDA share of total applications decreased to 0.4 percent from 0.5 percent the week prior.
The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($647,200 or less) increased to 3.78 percent from 3.72 percent, with points decreasing to 0.41 from 0.43 (including the origination fee) for 80 percent loan-to-value ratio (LTV) loans.
The effective rate increased from last week. The average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances (greater than $647,200) increased to 3.59 percent from 3.56 percent, with points decreasing to 0.31 from 0.38 (including the origination fee) for 80 percent LTV loans. The effective rate increased from last week.
The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA increased to 3.86 percent from 3.69 percent, with points decreasing to 0.55 from 0.61 (including the origination fee) for 80 percent LTV loans. The effective rate increased from last week.
The average contract interest rate for 15-year fixed-rate mortgages increased to 3.01 percent from 3.00 percent, with points increasing to 0.41 from 0.39 (including the origination fee) for 80 percent LTV loans. The effective rate increased from last week.
The average contract interest rate for 5/1 ARMs decreased to 3.09 percent from 3.18 percent, with points increasing to 0.35 from 0.33 (including the origination fee) for 80 percent LTV loans. The effective rate decreased from last week.
