Mortgage Apps Slip 2.6 Percent Week-Over-Week – NMP Skip to main content

Mortgage Apps Slip 2.6 Percent Week-Over-Week

Navi Persaud
May 20, 2020
Angled, aerial view of homes in the suburbs.

The latest data from the Mortgage Bankers Association's Weekly Mortgage Applications Survey showed a 2.6% decline in mortgage applications for the week ending on May 15, 2020, compared to the previous week. On an unadjusted basis, the market composite index showed a 2% drop from one week earlier. The refinance index fell 6%, but was still 160% higher than the same week one year ago. The seasonally adjusted and unadjusted purchase index rose 6%.
 
"Applications for home purchases continue to recover from April's sizeable drop and have now increased for five consecutive weeks. Purchase activity—which was 35% below year-ago levels six weeks ago—increased across all loan types and was only 1.5% lower than last year," said Joel Kan, MBA's associate vice president of economic and industry forecasting. "Government purchase applications, which include FHA, VA, and USDA loans, are now 5% higher than a year ago, which is an encouraging turnaround after the weakness seen over the past two months. As states gradually reopen and both homebuyer and seller activity increases, we will be closely watching to see if these positive trends continue, or if they reflect shorter-term, pent-up demand."
 
The report revealed that refinance activity decreased to 64.3% of total applications, down from 67% last week, while the adjustable-rate mortgage share of activity rose 3.2% compared to last week. The FHA share remained stagnant and the VA share of total applications decreased to 13.4%, down 0.3% from the previous week.
 
"Despite mortgage rates remaining close to record-lows, refinance activity slid to its lowest level in over a month," said Kan. "The average loan amount for refinances fell to its lowest level since January—potentially a sign that part of the drop was attributable to a retreat in cash-out refinance lending as credit conditions tighten. We still expect a strong pace of refinancing for the remainder of the year because of low mortgage rates. With many homeowners still facing economic and employment uncertainty, these refinance opportunities will allow them to save money on their monthly payments, which can then be used to help other areas of their budgets."
 
Earlier this week, the Mortgage Bankers Association’s (MBA) latest Forbearance and Call Volume Survey found that an estimated 4.1 million U.S. homeowners are now in forbearance plans, a week-over-week rise from 7.91% to 8.16%. And in a move seen by most as a means to allow borrowers to take advantage of historic low rates in a very uncertain time, the Federal Housing Finance Agency announced that borrowers with GSE loans who are in forbearance can apply for refinancing and new purchase mortgages once their loans are current, waiving a previous mandatory wait of 12 months.

 
Published
May 20, 2020
Lakeview Loan Servicing Faces Multiple Lawsuits Over Data Breach

At least a dozen civil lawsuits have been filed against the company, all seeking class-action status.

Industry News
May 26, 2022
Homepoint Rolls Out Jumbo ARM Loans

Homepoint's Jumbo ARM is a strategic addition to the company’s expanding jumbo portfolio.

Industry News
May 25, 2022
Planet Home Lending Expands in Oregon

New team in Portland focuses on construction lending in the Northwest.

Career
May 24, 2022
PennyMac Cutting 207 Jobs

A wide variety of positions are affected.

Industry News
May 24, 2022
Loan Officer Charged With Bank Fraud, Identity Theft

If convicted, she faces up to 30 years in federal prison on each bank fraud count and a mandatory consecutive 2 years’ imprisonment.

Industry News
May 24, 2022
Openn Launches Pilot with bridgeMLS For Sales In California

Agents in Northern California, Bay Area will be able to list property and accept offers using the platform. 

Tech
May 24, 2022