Further Slowdown in Mortgage Activity during Mid April

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Despite hopes for a housing market boost during the peak home sales season in the spring, mortgage activity is lower in the middle of April 2014. It seems that the warm weather has not stimulated buyers as much as experts and sellers had expected. The stability in mortgage rates has not had a positive impact either.

The number of mortgage applications fell by 3.3% in the middle of April on a weekly basis. The applications for refinance fell by 4% while the applications for home-buying mortgages fell by 3%. If the lower decrease in the number of applications for home-buying loans may seem not so bad news to some, they should look into the change in the rate on an annual basis. The number of such applications is 18% lower in the middle of April 2014 compared to the middle of April 2014.

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Despite the considerable slowdown in house purchases with the use of home loans, the major force behind the slower mortgage activity is the dramatic drop in refinancing. During the peak of the housing crisis, the number of applications for refinancing made up 80% of all applications. Now their number is lower than 50%.

The drop in the number of mortgage applications on a weekly basis coincided with a slight increase in the mortgage rates. In the middle of April, the average rate at which 30-year fixed loans closed was 4.49%. There was an increase of 0.02% on a weekly basis. At the same time, the average mortgage size is growing which reflects the higher increase in house prices compared to the increase in income. Currently, this number is $285,500. It is expected to go further up as housing affordability diminishes, especially in the major metropolitan areas.

Mortgage activity is still expected to improve throughout May and June when the number of house sales traditionally reaches its annual peak.

Christian

Christian

Christian Calvin mortgage Christian is a contributing writer for Mortgage.info. He is a graduate from the University of Tennessee with a degree in Communications and a concentration in Broadcasting. Christian has served as vice-president for a privately-held company for more than 20 years. Additionally, he has also applied his writing and business knowledge to various websites with a focus on business and sports news . . . both of which are passions. Christian enjoys playing golf and spending time with his family and friends.

Contact: christian@mortgage.info
Christian

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