Florida Mortgage Applications Up Slightly; Refinancing Activity Remains Strong

Florida mortgage applications crept higher last week, reflecting an increase in demand for refinancing, the Mortgage Bankers Association (MBAA) reported in its seasonally adjusted index of application activity for the week ending October 20.

Bolstered by an increase in Florida mortgage refinancing demand, as more residents of the Sunshine State look to lock into low fixed-rate loans, the group’s overall volume of activity increased 0.5 percent to 588.6 from the previous week’s 585.8.

The average borrowing costs on a 30-year fixed-rate Florida mortgage, the industry’s most popular financing tool and benchmark, averaged 6.36 percent, up 0.03 percent from the previous week, excluding points. That mark is well below a four-year high of 6.86 percent touched in June.

The Florida mortgage loan rates recorded across the state this week were well above year-ago levels of 6.06 percent, right about when the housing boom of 2000-2005 peaked.

The MBA’s purchase index fell 0.6 percent to 382.4. The index finished the week substantially below its year-ago level of 466.4. The purchase index is considered a timely gauge of home sales, which have been dropping this year after five successive years of record growth.

State and national economists remain concerned that sales falling too far will result in a widespread housing slump. The group’s seasonally adjusted index of Florida mortgage refinancing applications increased 1.8 percent to 1,790.4.

Many Florida real estate agents and analysts expect this to keep rising throughout the rest of this year, as more people are taking it upon themselves to opt out of risky Florida home loans with adjustable-rates and refinance over to fixed-rate mortgage loans, in which their monthly payments remain the same over the life of the loan.