Mortgage application volume increased 5.3 percent on a seasonally adjusted basis during the week ending April 15 as government mortgage demand surged, the Mortgage Bankers Association reported today.
The refinance index increased a meager 2.7 percent from the previous week, but purchase money mortgages jumped 10.0 percent, mostly due to a 17.6 percent spike in FHA loan lending.
“Purchase application volume jumped last week largely due to another sharp increase in applications for government loans. Borrowers were likely motivated to apply for loans before the scheduled increase in FHA insurance premiums,” said Michael Fratantoni, MBA’s Vice President of Research and Economics, in a release.
“Refinance activity increased somewhat, as rates dropped to their lowest level in a month towards the end of the week.”
That pushed the refinance share of mortgage activity to 58.5 percent of total applications from 60.3 percent a week earlier.
So it looks as if purchases will eclipse refinances in the near future, which is good news for the flagging housing market.
Meanwhile, the popular 30-year fixed-rate mortgage dipped to 4.83 percent from 4.98 percent, keeping the hope of refinancing alive for more borrowers.
The 15-year fixed averaged 4.07 percent, down from 4.17 percent a week earlier, meaning mortgage rates are still very, very low historically.
That alone could bring more buyers to the signing table this summer.
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