Florida Mortgage Applications Fall as Home Loan Rates Slip Throughout State

Florida mortgage applications fell last week, reflecting a drop in demand for home purchase loans as interest rates climbed, the Mortgage Bankers Association said Wednesday.

In its seasonally adjusted index of Florida mortgage application activity, which includes both refinancing and purchasing loans, for the week ending January 12, decreased 0.6 percent to 667.2.

However, the four-week moving average (which tracks trends in the market) of mortgage applications rose 0.8 percent. Borrowing costs on 30-year fixed-rate mortgages averaged 6.19 percent, up 0.06 percent from the previous week.

Florida home loan rates are now slightly above year-ago levels of 6.07 percent. Points are not included in the rates listed above.

The MBA’s seasonally adjusted purchase index, widely considered a timely gauge of future home sales, fell 7.0 percent to 439.7. The index was also below its year-ago level of 443.9.

The group’s seasonally adjusted index of refinancing applications rose 6.3 percent to 2,045.8, its third consecutive weekly climb. A year earlier, the group’s index stood at 1,645.2.

The share of applications devoted to Florida mortgage refinancing increased to 49.9 percent from 48.4 percent the previous week.

Fixed, 15-year mortgage rates averaged 5.92 percent, up from 5.85 percent. Rates on one-year adjustable-rate mortgages (ARMs) increased 0.06 percent to 5.85 percent from 5.79 percent.

Theshare of activity increased dedicated to adjustable-rate Florida mortgage applications fell 21.2 percent from 20.1 percent the previous week when it was at its lowest since July 2003.

Experts predict ARMs will continue to slip in popularity, as fixed mortgage rates are expected to remain between 6.50-7.00 percent throughout 2007, offering little incentive to opt for more risky ARMs.