Demand for purchase mortgages during the week ending Jan. 14 dropped by a seasonally adjusted 1.9 percent from the week before and fell 16 percent from a year ago, the Mortgage Bankers Association said in releasing the results of its weekly applications survey.
"Mortgage rates have moved somewhat lower since the beginning of the year, as mixed data on the job market continue to cloud the outlook for the economy," said Michael Fratantoni, MBA’s vice president of research and economics. "Refinance applications have picked up, as borrowers take advantage of lower rates, but purchase applications remain quite low, indicating that home sales are unlikely to pick up any time soon."
Applications for refinancings were up for the third week in a row, rising 7.7 percent from the week before to the highest level since the beginning of December, the MBA said.
Requests for refinancing accounted for 73 percent of all loan applications, the highest since the week ending Dec. 10.
The average contract interest rate for 30-year fixed-rate mortgages decreased to 4.77 percent from 4.78 percent, with points increasing to 1.2 from 0.91 (including the origination fee) for 80 percent loan-to-value (LTV) ratio loans. The effective rate increased from last week.
The average contract interest rate for 15-year fixed-rate mortgages increased to 4.16 percent from 4.15 percent, with points decreasing to 0.9 from 1.01 (including the origination fee) for 80 percent LTV loans. The effective rate also decreased from last week.