Mortgage Rate Drop Doesn’t Spur Demand

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According to the Mortgage Bankers Association’s Weekly Applications Survey, mortgage rates fell last week across all loan categories, including 30-year fixed-rate mortgages with both conforming and jumbo balances, loans backed by the Federal Housing Administration, and 15-year fixed-rate loans. The decrease was the first in three weeks. After hitting a 14-month low the first week in September, mortgage rates had been on the rise until last week’s dip. But despite the decline, demand for loan applications was relatively flat from the week before. In fact, the Market Composite Index – which measures both refinance and purchase demand – was down just 0.2 percent. The refinance index slipped 0.3 percent and the purchase index was unchanged from the previous week. The seasonally adjusted conventional purchase index, on the other hand, increased 1.3 percent and reached its highest level since July. The MBA’s weekly survey has been conducted since 1990 and covers 75 percent of all retail residential mortgage applications. More here.

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