Mortgage Loan Applications Hit A Record High

Looking to buy your dream home?

You’re not alone.

The Mortgage Bankers Association just released data proving that Americans are valuing real estate more than ever, with US mortgage loan applications on a steady rise.

Read on for more details from Reuters.

U.S. Loan Demand for Home Purchase Hits 19-Month High

A gauge of U.S. mortgage demand to buy a home climbed to its strongest level over 1-1/2 years last week even as most mortgage rates edged higher, according to Mortgage Bankers Association data released on Wednesday.

The recent pickup in mortgage application activity for home purchases reinforced the view of underlying strength in the housing sector. An improving labor market and steady wage gains have offset the rise in interest rates since Donald Trump’s U.S. presidential win in November and tight inventories nationwide, analysts said.

The Washington-based industry group said its index of mortgage applications to buy a home, a proxy for future home sales, increased 1.7 percent on a seasonally adjusted basis to 250.3 points in the week ending May 5.

This was the highest level for this measure since 257.4 in the week of Oct. 2, 2015, MBA data showed.

“Home sales should be picking up as we are seeing with the purchase mortgage applications. We are going to see both new and existing home sales trending higher in the coming months,” said David Berson, chief economist at Nationwide Mutual Insurance Co. in Columbus, Ohio.

Interest rates on conforming 30-year fixed-rate mortgages were unchanged at 4.23 percent last week, while average mortgage rates on other types of 30-year loans MBA track were 0.03 percentage point to 0.04 percentage point higher than the prior week.

Conforming loans are those with balances of $424,100 or less which qualify for guarantees from federal mortgage agencies Fannie Mae (FNMA.PK) and Freddie Mac (FMCC.PK).

MBA said its seasonally adjusted index on conforming loan activity to buy a home rose to 316.9, which was the highest since April 2009.

Thirty-year mortgage rates rose in step with higher Treasury yield last week.

Meanwhile, MBA’s seasonally adjusted gauge of applications to refinance an existing home loan rose 3.3 percent to 1,345.5.

Increases in weekly purchase and refinancing application volumes lifted MBA’s seasonally adjusted index on overall mortgage activity to 415.7 points, the strongest level in eight weeks.
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Owning a home is a dream, but financing it? If mismanaged, could easily become a nightmare. More and more Americans are putting their backs into owning a home. They are finding ways to beat the rising interest rates brought about by Trump’s election and allocating a larger chunk of their funds to mortgage loans.

These latest stats simply prove that the American Dream is alive and well despite these seemingly cash-strapped times. Taking out a mortgage need not be a daunting prospect!

Real estate may be a tricky investment, but this latest news proves that it can be a sound one. And even more heartening is the fact that more and more people are putting their faith in their ability to own their own home–so you definitely should, too!

There are many strategies you can employ to streamline your budget and afford your monthly payments, and there are multiple sources of support you can lean on to keep you on track (us included!).

Looking for tips on mortgage loan applications? Read more here.

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