Mortgage Applications Fall Sharply

Applications for mortgages to purchase properties declined 10.5 percent last week compared to the previous week on a seasonally adjusted basis, according to the weekly mortgage applications survey released by the Mortgage Bankers Association.

On an unadjusted basis, the purchase index was down 10.5 percent compared to the previous week and fell 17.5 percent compared to the same week a year ago.

Application volume was affected by the rising cost of FHA mortgage insurance premiums, the bankers said. Applications for conventional mortgages also were down, driven by an increase in rates, said Mike Fratantoni, the association’s vice president of research and economics.

Overall, applications for both purchases and refinances decreased 9.6 percent on a seasonally adjusted basis. Interest rates actually decreased compared to the previous week:

• 30-year fixed-rate mortgages decreased to 5.17 percent from 5.31 percent.
• 15-year fixed-rate mortgages decreased to 4.45 percent from 4.54 percent.
• 1-year ARMs decreased to 7.02 percent from 7.03 percent.

Source: Mortgage Bankers Association (04/14/2010)