Posted by OR on 1/4/12 6:24pm
Msg #408219

Rate Lock- refi apps info

The weeks may have been short and the seasonal adjustment difficult but mortgage application activity definitely declined during the two weeks ended December 30 (December 23 week included due to holiday). This is the conclusion of the Mortgage Bankers Association whose purchase index over the two week period fell a very steep 9.7%. The drop interrupts what had been a steady stream of good news out of the housing sector. Down 1.9% in refinancing which makes up the great bulk of mortgage activity, at 82% for the highest share of 2011. Homeowners are increasingly refinancing their mortgages as rates sink. For the lowest rate of 2011, the average 30-year conforming mortgage ($417,500 or less) was 4.07% in the period.

Reply by JanetK_CA on 1/5/12 1:40am
Msg #408230

Makes perfect sense to me. When loan originators, potential borrowers, etc., take time off around the holidays, there are fewer loans being originated and less volume in the pipeline. The trickle hits us after the fact, once business originated prior to that dries up. This is a great time of the year to get caught up on things or get a jump start on others, if volume is down.

People are going to be getting their bills for all their holiday shopping and loan originators will be doing their best to get more activity going and borrowers will be looking for ways to reduce expenses (like lowering interest rates on their home loan), so the engine is bound to get revved up again. The big question is what will happen with interest rates.