FHA Lenders See Rise for FHA Refinancing and Home Buying
Over the last few months many FHA loan companies have been struggling to submit new loans into process because the loan application volumes were down for FHA refinancing and new home buying. There were a few good weeks here an there, but overall, morale was down for loan officers according to several FHA lenders. The Mortgage Bankers Association published its weekly home loan application report for the week that ended on June 11th. Home refinancing and purchase mortgage applications rose and that is good news for mortgage brokers and lenders across the country.
There was also good news the government mortgage programs as both FHA and VA loan applications increased significantly. refinance loan guidelines have seen some tightening of one of the most popular programs, the FHA streamline in which borrowers are no longer allowed to finance the closing costs. Borrowers must pay for the closing costs themselves outside of the loan. Many FHA lenders have said that this had hurt their FHA refinance business, but it appears the borrowers are still using FHA for refinancing transactions. FHA first time home buying loans could become fashionable again as more people look to become homeowners this summer.
The MBA’s index measures the volume of home mortgage applications and the report indicated an increase of 17.7% from the week prior. The Unadjusted Index spiked 29.7%, when compared to the prior week but the Memorial Day holiday shortened that week.
Michael Fratantoni who is MBA’s Vice President of Research and Economics, released a statement saying, “Mortgage loan applications for home buying rose last week, the first increase in over a month. Mortgage refinance applications also roseup dramatically over the week.” He further went on to state that, “While it is clear that home loan applications in May dropped sharply as a result of the tax credit induced increase in applications in April, it is unclear whether we are seeing the beginnings of a rebound now.” The Weekly Home Loan Applications Survey contains over a dozen indices that covers mortgage-related application activity for fixed and adjustment rate, as well as conventional and government loans for home purchase and refinances.
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