Mortgage applications drop 9.6% as refinancing surge dies down
The number of mortgage applications filed by Americans fell 9.6% this past week after experiencing a dramatic surge in volume on low interest rates and refinancing activity. The Mortgage Bankers Association's market composite index – a measure of loan volume – fell 9.6% on a seasonally adjusted basis from a week earlier. On an unadjusted basis, the index fell 10% from the previous week. Refinancing activity, which buoyed loan application levels in recent weeks, died down with the refinance index falling 12.2% from a week ago. The seasonally adjusted purchase index, meanwhile, grew a slight 0.9%. "Accounting for the increase in average points paid, effective mortgage rates were little changed last week. Refinance application volume declined for a second week from recent highs, despite rates staying near a 10-month low, while purchase volume remained near 15-year lows," said Mike Fratantoni, vice president of research and economics for the MBA. The refinance share of mortgage activity remained high at 77.8% of total applications, down from 79.8% the previous week. The adjustable-rate mortgage share of activity increased to 7.1% from 6.2% of total applications a week ago. Mortgage rates continued to fall with the 30-year, fixed-rate mortgage dropping to 4.32% from 4.39%. The average rate for the 15-year, FRM decreased to 3.49% from 3.56%. Write to: Kerri Panchuk.