Home loan applications climb for the week

Good news are still rather rare in this current real estate environment, so when something noteworthy takes place, you ought to jump on it and shape a report to spread the word. Here's one of them that may not yet repeat itself week after week, but at least for now the curve on the chart is moving up.

The MBA, or Mortgage Bankers Association, conducts a weekly survey on loan applications nationwide and for the week ending October 26 it shows a volume increase of 3.8%. A nice uptick indeed. Encouragingly interest rates have recently been inching down which then has definitely helped push lending activity higher. That's all good news.

Refinance apps grew 9.2% in that time period, providing the most weight for the boost. That makes sense as homeowners are busy refinancing their soon-to-reset ARMs to more affordable programs. On the other hand, purchase ones decreased 0.7%. It's a small shift, yes, but glaringly indicative of the soft market we continue struggling with in most areas of the country.

Keep in mind that the survey includes data from mortgage banks, thrifts and commercial banks and covers only about 50% of the entire residential mortgage origination scene. Nevertheless, it's a solid barometer on the present market conditions.

When things turn permanently for the better, it just won't happen one specific week and then head up for good. Rather, at the bottom of the cycle the stats go back and forth for a while between positive and negative, sort of testing the ground for stability, and then begin slowly improving.