Mortgage Application Volume Rebounds and Increases

Filed under: Market Comentary

mort delinquency decThose in the mortgage industry concerned about the sharp drop in mortgage activity over the holiday season don’t have to worry.

According to a recent article by Diana Olick from CNBC and the Mortgage Bankers Association, mortgage application volume increased 21.3% last week versus the previous week on a seasonally adjusted basis.

Olick explained that mortgage applications were on a “roller coaster” in December as borrowers rushed in early during the month to get ahead of a possible Fed rate hike.

Lynn Fisher, Mortgage Bankers Association vice president of research and economics said, “The good news for the new year is that following the holidays, application activity last week resumed at levels just exceeding those observed during early December, suggesting that the purchase market has picked up right where it left off.”

The CNBC article stated that mortgage applications to purchase a home increased 18% from the previous week and were 19% higher than the same week last year at this time.

Fisher added, “MBA’s purchase to mortgage application index reached its second highest level since May 2010 on a seasonally adjusted basis last week, second only to the week prior to the implementation of the Know Before You Owe rules.”

According to Olick, the Know Before You Owe rules, which are designed to protect borrowers, have been blamed for delays in closings. She also added that some claim these rules caused the steep drop in closed sales in November. Borrowers had been warned about the Know Before You Owe rules, that went into effect in October, and may be the reason why there may have been a rush on loan applications right before they actually went into effect.

In addition, applications to refinance loans increased 24% last week from the previous week. However, this was 38% lower than the same week one year ago.

If you have any questions about anything in the mortgage industry, please give me a call and we can discuss whatever is on your mind.

source: from web




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