Mortgage Applications Slide To Slowest Pace Of The Year

Mortgage applications fell 6.6% last week on a seasonally adjusted, weekly basis, even as average mortgage rates moved lower through the week.

Purchase applications remain few and far between to start the year, continuing the decline previously observed in the past two weeks’ of data.

In a sign of cautious optimism, however, purchase applications remain slightly ahead of last year, the worst year for existing-home sales since the mid-1990s.

Despite being 39% higher than the same week last year, refinance applications decreased 7% from last week as rates “remained close to 7 percent,” the Mortgage Bankers Association (MBA)’s Vice President and Deputy Chief Economist Joel Kan said in a press release.

Kan said “buyers remained on the fence,” while noting that “loosening inventory” may help support a more active purchase market “in the coming months.” He added that “mortgage applications decreased to their slowest pace since the beginning of the year.”

The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($766,550 or less) decreased to 6.93% from 6.95% for the week ending Feb. 14, per the MBA. The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA increased to 6.7% from 6.69%.