Jan. 16 (UPI) -- The United States saw a surge in mortgage applications last week, up more than 13 percent from the previous week, statistics showed Wednesday.
"Uncertainty regarding the government shutdown, slowing global growth, Brexit, a more patient Fed, and a volatile stock market continued to keep rates from increasing," Mike Fratantoni, the association's chief economist, said. "The spring home buying season is almost upon us, and if rates stay lower, inventory continues to grow, and the job market maintains its strength, we do expect to see a solid spring market."
"Borrowers with larger loans tend to be more responsive to a given drop in mortgage rates, and we are seeing that so far in 2019," Fratantoni added. "Furthermore, borrowers with jumbo loans are also more apt to take adjustable-rate mortgages as opposed to fixed-rate loans. Thus, it is not surprising to see the ARM share at its highest level since 2014."
The lower rates did not make everyone happy. J.P. Morgan said this week its home lending revenue was down 8 percent this quarter, driven by "lower net reduction revenue in a low volume highly competitive environment."
The ongoing federal shutdown is having an impact on some Americans' ability to close on home loans.
"Right now, our USDA loans are the only loans that we cannot close on ... [because] the U.S. Department of Agriculture is being affected by the government shut down," Benchmark Mortgage loan officer Lori Robinson said.
USDA loans are zero-down mortgage contracts for low-income buyers in rural and suburban areas. About 140,000 Americans bought a home with a USDA loan in 2017.
FHA and Veterans Affairs home loans, however, are still being processed during the shutdown.