MBA Chart of the Week: Refinance Applications and Average Loan Size

Since late 2014, we’ve seen a stronger relationship between the average loan amount on refinance applications and the refinance index, MBA’s gauge of refinance application activity.

The current chart shows that increases in the refinance index have coincided with increases in the average loan size for a refinance application. Nearly 75 percent of borrowers in agency 30 year fixed loans have a rate of 4.5 percent or less; and of borrowers who are still likely to refinance their current loans, those with higher loan balances are more sensitive to rate changes, as even small movements in rates will have relatively greater impact on their monthly payments.  

The average refinance loan size reached its highest level in the survey’s history the week of February 12, when the refinance index was also at its highest in a year and rates were well below 4 percent. Over the past five weeks, rates have risen cumulatively by 8 basis points and both the refinance index and average loan amount have fallen for five consecutive weeks as burnout continues.  

To view the Chart of the Week, click  

(Lynn Fisher is vice president of research and economics with the Mortgage Bankers Association; she can be reached at Joel Kan associate vice president of economic forecasting with MBA; he can be reached at