Market update: Mortgage applications drop 2.2 percent

The MBA’s weekly mortgage application survey reported a 2.2 percent drop in overall activity, with a 0.2 percent increase in purchase applications. Quicken Loans Vice President Bill Banfield offers the following comments on the report.

“Despite mortgage backed security issuance being up 38 percent from the first quarter average, the MBA index continues to show declines.  This suggests that there are fundamental shifts occurring in the market where big players (reporting to the MBA) may be giving up market share or perhaps not holding as many loans in portfolio, thereby pushing up the bond issuance.  In either case, the current level of activity for purchases and refinances has been directional stronger in recent months based on actual security issuance.  With home prices stabilizing from a rapid level of appreciation and interest rates either falling or holding steady recently, I expect to see continued improvements in the purchase arena.”

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