Mortgage Applications Decrease in Week Ending January 21, 2022

According to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Application Survey (WMAS), for the week ending January 21, 2022, the Market Composite Index, a measure of mortgage loan application volume, declined -7.1% on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index decreased -6.0% compared with the previous week.

The Refinance Index decreased -13.0% from the previous week and was -53.0% lower than the same week one year ago.

The seasonally adjusted Purchase Index decreased -2.0% from one week earlier. The unadjusted Purchase Index increased 5.0% compared with the previous week but was -11.0% lower than the same week one year ago.

In remarks prepared for the release of this week’s WMAS, Joel Kan, MBA’s Associate Vice President of Economic and Industry Forecasting said, “All mortgage rates in MBA’s survey continued to climb, with the 30-year fixed rate rising for the fifth consecutive week to its highest level since March 2020. The 30-year fixed rate is now 77 basis points higher than it was a year ago. Unsurprisingly, borrower demand for refinances subsided, with applications falling for the fourth straight week. After almost two years of lower rates, there are not many borrowers left who have an incentive to refinance. Of those who are still in the market for a refinance, these higher rates are proving much less attractive to them.”

“The decline in purchase activity was led by a 5 percent drop in government applications, compared to a modest less than one percent decline in conventional applications,” Kan added. “The relative weakness in government purchase activity continues to contribute to higher loan sizes. The average purchase loan size was $433,500, eclipsing the previous record of $418,500 set two weeks ago.”