The number of mortgage applications decreased 12.3 percent on a seasonally adjusted basis, while increasing 13 percent on an unadjusted basis, during the week ending December 14, the Mortgage Bankers Association announced today.
The Refinance Index fell 14 percent from last week, reaching the lowest level since the week ending November 2, 2012, and the seasonally adjusted Purchase Index decreased 5 percent from one week earlier. Unadjusted, however, the Purchase Index fell 4 percent from last week, but is 9 percent higher year-over-year. The share of refinancing activity dropped to 83 percent of total applications. The adjustable-rate mortgage share of activity held at 3 percent of total applications.
“Despite the Federal Reserve’s announcement last week that it would purchase an additional $45 billion in Treasury securities per month as part of its continuing quantitative easing effort, rates increased in the second half of the week,” Mike Fratantoni, MBA’s Vice President of Research and Economics, said. “As a result, refinance applications dropped sharply to the lowest level in over a month.”
Interest rates for 30-year fixed-rate loans with conforming balances increased to 3.5 percent from 3.47 percent. Jumbo loan rates decreased to 3.73 percent, the lowest rate in the history of the survey, from 3.77 percent. Rates for Federal Housing Administration-backed 30-year fixed-rate loans decreased to 2.83 percent, the lowest rate in the history of the survey, from 2.85 percent —Christopher Cameron