Mortgage loan applications fell by 0.4 percent nationwide over the last week, spreading unease among lenders concerned about the potential for a dip in the housing market, according to a study released by the ""Mortgage Bankers Association"":http://www.mortgagebankers.org (MBA) on Wednesday.[IMAGE]
The results come from MBA's Weekly Mortgage Applications Survey, which measures changes in adjustable-rate, fixed-rate, conventional, and government loans for mortgages across 15 indices. MBA posted downward trends for several indices, which this week included adjustments for the Memorial Day holiday.
_The Wall Street Journal_ attributed the slight dip to tighter-than-usual credit conditions, citing a lack of equity among 24 percent of the homes of mortgage borrowers.
The 0.4 percent drop is the latest in a national trend that continues to unsettle housing markets. The decline in loan applications coincides with the lowest rates for mortgages in the last six months and the fewest applications for home purchases in nearly 15 years.[COLUMN_BREAK]
""People are nervous,"" Mark Zandi, chief economist of Moody's Analytics, told the _Journal_. ""Signing on the bottom line to buy a home requires confidence.""
The survey's Market Composite Index calculated the 0.4 percent decrease on a seasonally adjusted basis. Unadjusted, the same index fell by 11 percent from the previous week.
MBA's Purchase Index, reflecting mortgage applications for new purchases of homes, showed a seasonally adjusted 4.4 percent decrease from the past week, alongside an unadjusted 15.2 percent decrease.
The adjusted Refinance Index increased 1.3 percent from the previous week. The Refinance Index is not seasonally adjusted but is adjusted for the holiday.
The four-week moving average for the Market Composite climbed by 1.0 percent. The four-week trend for the Purchase Index documented a 1.6 percent decrease, while the Refinance Index showed a 1.3 percent increase.
MBA also released average contract rates for 30- and 15-year fixed-rate mortgages. Rates for 30-year fixed-rate mortgages fell from 4.58 percent to 4.54 percent, marking a new low since late 2010. Rates for 15-year fixed-rate mortgages also hit a new bottom since last year, declining to 3.67 percent from 3.78 percent.
Coordinated by MBA since 1990, the Weekly Mortgage Applications Survey covers over 50 percent of all U.S. retail residential mortgage applications, based on data from the thrift, commercial, and mortgage banking industries.
MBA is a national association that represents the real estate finance industry.