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Mortgage applications rise as refinances fall

March 23rd, 2012

The number of borrowers applying for mortgages to purchase homes jumped earlier this month, but refinancing applications declined, according to the Mortgage Bankers Association (MBA). Applications for home purchases rose 4.4 percent for the week ending March 9 while those for refinancing fell 4.1 percent from the previous week.

“(Home) purchase applications are now almost 12 percent above the level one month ago, even after adjusting for typical seasonal patterns,” Michael Fratantoni, MBA’s Vice President of Research and Economics, said in a statement. “HARP volume continued to grow as a share of total refinance volume, reaching roughly 30 percent of refinance activity in the last two weeks. Typical HARP loans had loan-to-value ratios above 90 percent, indicating that lenders are reaching out to underwater borrowers.”

The increase in mortgage applications for purchase came as the Bureau of Labor Statistics reported that the unemployment rate improved. The unemployment rate fell in 45 states, setting the national unemployment rate for the U.S. at 8.3 percent.

But despite this positive economic news, mortgage rates have remained near record lows. The average for a 30-year fixed-rate mortgage is 3.89 percent, and the 15-year loan sits at 3.2 percent. For purchasers shopping for a good deal, home prices fell to the lowest levels since the housing crisis began, according to the most recent S&P/Case-Shiller Home Price Indices, indicating that the time may be right for shoppers to go in search of real estate deals.

Delinquent home loan percentage decreases in Q4

March 1st, 2012

The mortgage delinquency rate fell to a seasonally adjusted rate of 7.58 percent to close the fourth quarter of 2011, according to the Mortgage Bankers Association (MBA). The serious delinquency rate, the percentage of loans 90 or more days past due or in the foreclosure process, also fell to 7.73 percent.

Mortgages helped by employment

Jay Brinkmann, MBA’s Chief Economist and Senior Vice President for Research and Education:

Mortgage performance continued to improve in the fourth quarter, reflecting the improvement we saw in the job market and broader economy,”┬áJay Brinkmann, the MBA’s chief economist, said in a statement. “The total delinquency rate and foreclosure starts rate decreased and are back down to levels from three years ago.

“A major reason is that the loans that are seriously delinquent are predominantly made up of loans originated prior to 2008 and this pool is steadily growing smaller as a percent of total loans outstanding. In addition, employment is the key driver of mortgage performance and the mortgage delinquency rate is actually falling faster than the unemployment rate is declining.”

The MBA survey also found that the percentage of mortgage loans in foreclosure at the end of the fourth quarter was 4.38 percent, down from 4.64 percent the previous year. Total delinquency rates and foreclosure starts fell from the previous quarter for most types of home loans, including prime fixed, prime adjustable-rate mortgage (ARM), sub-prime fixed and sub-prime ARM. FHA loans, however, saw an increase in delinquency and foreclosure rates.

Is help for mortgages on the way?

Finding the right help can be a game-changer if you are struggling with paying a mortgage on time. Whether you are hoping to refinance a home loan or think you may be eligible for help through the government’s recent settlement with mortgage loan servicers, it is important to check out all options that may be available to you. Talk with your mortgage lender or a housing counselor to find out what you can do to save your home.