The average purchase loan amount has reached a new record high: $402,200, the Mortgage Bankers Association reported Wednesday. The higher-priced segment of the housing market continues to perform strongly, the MBA says.

Mortgage amounts have been climbing to new record highs since April 2020, near the start of the COVID-19 pandemic.

Mortgage applications for home purchases were up 17% last week over last year, the MBA reports.

Home buyers are borrowing more as home prices rise by double-digit percentages over the past year. Also, mortgage interest rates have been hovering near record lows. “Since interest rates are lower, monthly payments are lower—even with higher loan balances,” says The Ascent, a Motley Fool financial publication. “This makes it easier for would-be borrowers to get approved for bigger loans.” 

Source: “Mortgage Applications Decrease in Latest MBA Weekly Survey,” Mortgage Bankers Association (Feb. 10, 2021); “Homeowners Are Borrowing More Than Ever as the Average Mortgage Climbs to New Highs,” The Ascent/Motley Fool (Feb. 9, 2021); and “January Mortgage Credit Availability Increases,” Mortgage Bankers Association (Feb. 9, 2021)