Mortgage Applications Drop Amid Rising Coronavirus Concerns


Mortgage Bankers Association Weekly mortgage application survey reported that for the week ended July 16, 2021, the number of mortgage applications decreased by 4% compared to the previous week.

In addition, the MBA study found that the refinancing index fell 3% from the previous week, and the seasonally adjusted shopping index was down 6% from the previous week. The unadjusted purchase index was 18% lower than the same period last year, which is not surprising for the number of applications for the purchase of new housing fell by almost 24% as reported yesterday.

While the world appears to be making headway in the fight against the COVID-19 virus, the rapidly spreading options are worrying when it comes to the potential impact on the global economic recovery.

“The yield on 10-year Treasuries fell sharply last week, in part as investors became more worried about the spread of COVID variants and their impact on global economic growth. As a result, there were mixed changes in mortgage rates: the 30-year fixed rate increased slightly to 3.11% after two weeks of decline. Other rates surveyed have declined: The 15-year, fixed-rate loan used by about 20% of refinancing borrowers fell to 2.46% – the lowest level since January 2021, ”said Joel Kahn, MBA’s deputy vice president for economic and industrial forecasting. … “On a seasonally adjusted basis compared to the July 4 holiday, mortgage applications were lower across the board, with purchase applications returning to their lowest level since May 2020. Limited stocks and higher prices are keeping some potential home buyers out of the market. Refinancing activity decreased over the week, but as rates remained relatively low, the number of applications was close to the highest level since the beginning of May. ”

Meanwhile, the share of refinancing of mortgage activities increased to 64.9% of the total number of applications, the share of adjustable rate mortgages fell to 3.3%, and the share of FHA increased very slightly from 9.5% to 9.6% compared to from the previous week, according to research. …

The share of VA in the total number of applications increased from 10.3% to 10.5%, while the share of USDA in the total number of applications did not change.

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