Mortgage Applications Fall in the U.S.

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Mortgage applications in the U.S. dropped for the second week in a row, according to the Mortgage Bankers Association. 

Applications for the week ending February 14, 2014 fell 4.1 percent from one week earlier, after decreasing 2.0 percent the previous week. 

The refinance index fell 3 percent from the previous week. The refinance share of mortgage activity dropped to 61 percent of all applications, from 62 percent the previous week. It was 17 percent lower than the same week last year. 

The adjustable-rate mortgage share of activity increased to 8 percent of all applications. The seasonally adjusted purchase index dropped 6 percent from the previous week and is now at the lowest level since September of 2011.

More from the report:

• The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($417,000 or less) increased to 4.50 percent from 4.45 percent, with points decreasing to 0.26 from  0.34 (including the origination fee) for 80 percent loan-to-value ratio (LTV) loans. The effective rate increased from last week.

• The average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances (greater than $417,000) increased to 4.45 percent from 4.40 percent, with points decreasing to 0.11 from 0.14 (including the origination fee) for 80 percent LTV loans.  The effective rate increased from last week.

• The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA increased to 4.16 percent from 4.13 percent, with points increasing to 0.14 from 0.10 (including the origination fee) for 80 percent LTV loans. The effective rate increased from last week.

• The average contract interest rate for 15-year fixed-rate mortgages increased to 3.55 percent from 3.49 percent, with points increasing to 0.33 from 0.25 (including the origination fee) for 80 percent LTV loans. The effective rate increased from last week.

• The average contract interest rate for 5/1 ARMs increased to 3.20 percent from 3.11 percent, with points increasing to 0.38 from 0.31 (including the origination fee) for 80 percent LTV loans. The effective rate increased from last week.