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Mortgage applications decrease from one week earlier

Posted on Friday, February 3, 2012 at 3:10:49 PM

According to data from the Mortgage Banker's Association (MBA) Weekly Mortgage Applications Survey, mortgage applications decreased by 2.9 percent from the previous week. The survey used information regarding mortgage applications for the weekend ending January 27, 2012.

Compiled from the Market Composite Index, a measure of mortgage loan application volume, the decrease was a result of a seasonally adjusted basis. When the rate was left unadjusted, it actually showed a 9.0 percent increase when compared to the previous week. While mortgage application rates were slightly lower than the previous week, refinancing applications were on a rise as more homeowners conduct a home mortgage comparison and consider historically-low interest rates.

"The Federal Reserve surprised the market last week by indicating that short-term rates were likely to stay at their current low-levels until the end of 2014.  Longer-term treasury rates dropped in response, and mortgage rates for the week were down slightly as a result," said Michael Fratantoni, MBA’s Vice President of Research and Economics. 

"Although total application volume dropped on an adjusted basis relative to last week, refinance volume remains high, with survey participants reporting that the expanded Home Affordable Refinance Program (HARP) contributed to roughly 10 percent of their refinance activity."