Mortgage Pricing Hits Wall. Loan Demand Declines ..

According to the mortgage news daily says,The Mortgage Bankers Association (MBA) today released its Weekly Mortgage Applications Survey for the week ending February 25, 2011.

The MBA's loan application survey covers over 50% of all U.S. residential mortgage loan applications taken by mortgage bankers, commercial banks, and thrifts. The data gives economists a snapshot view of consumer demand for mortgage loans. In a falling mortgage rate environment, a trend of increasing refinance applications implies consumers are seeking out lower monthly payments. If consumers are able to reduce their monthly mortgage payment and increase disposable income through refinancing, it can be a positive for the economy as a whole (may boost consumer spending. Also allows debtors to pay down personal liabilities faster). A trend of declining purchase applications implies home buyer demand is shrinking.

Excerpts from the Release...

The Market Composite Index, a measure of mortgage loan application volume, decreased 6.5 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index decreased 5.5 percent compared with the previous week.

The Refinance Index decreased 6.5 percent from the previous week. The four week moving average is down 2.7 percent. The refinance share of mortgage activity decreased to 64.9 percent of total applications from 65.7 percent the previous week.

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