Demand For Home Purchase Loans Increases

According to the Mortgage Bankers Association’s Weekly Applications Survey, the number of potential home buyers seeking a loan to purchase a home rose 2 percent last week from the week before. The increase was driven by a 5.6 percent jump in the number of buyers applying for loans backed by the Federal Housing Administration. Government home purchase loans have lower down payment requirements and are typically popular among first-time home buyers, who have less savings and a more difficult time coming up with a down payment. The overall boost in buyer demand came during a week when mortgage rates were mostly down. In fact, rates fell on 30-year fixed-rate loans with both conforming and jumbo balances, in addition to 15-year fixed-rate loans. Mortgage rates on FHA loans rose slightly. Mike Fratantoni, MBA’s chief economist, said recent stock market volatility hasn’t yet affected results. “The turmoil in global stock markets and subsequent drop in interest rates that began late last week is not evident in these results, but will likely have a significant impact on next week’s results.” Fratantoni told CNBC. 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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