Mortgage applications rebound following news of success in 2012

9/23/2013 1:26:34 PM

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Data from the Federal Financial Institutions Examination Council shows that 2012 was a banner year for mortgage activity. Of the banks, savings associations, credit unions and mortgage companies covered in the data,15.3 million home loan applications were reported throughout 2012.

Of this number, 9.8 million resulted in loan originations. This marked an increase of 38 percent from 2011. This is partly attributed to a 54 percent increase in mortgage refinancing. The number of VA home loans also increased during this time period, rising 11 percent from 2011.

Meanwhile, conventional loans accounted for 85 percent of refinancing during 2012, while FHA and VA loans accounted for 9 percent and 6 percent, respectively. The number of conventional loans used for refinancing rose 51 percent during 2012 on a year-over-year basis, while FHA and VA loans used for refinancing increased 78 percent and 90 percent during the same time period.

While mortgage activity has declined in recent months due to rising interest rates, figures from the Mortgage Bankers Association show that there was a marked improvement during the week ending Sept. 13 when compared to the week ending Sept. 6. The MBA reported that its Market Composite Index, which measures mortgage application volume, increased 11.2 percent on a seasonally adjusted basis during the week ending on Sept. 13. This was led by an 18 percent increase in refinancing, a major change from the 20 percent decline in refinancing applications posted the previous week.

Borrowers of all stripes still have the chance to lower their monthly mortgage payments while interest rates remain historically low. Whether an FHA or VA loan refinance, replacing an existing loan with a new one can have many benefits for borrowers.

Contact The Federal Savings Bank, a veteran owned bank, to find out more about refinancing.