For the third week in a row, mortgage application increased, rising 8.8% from one week earlier, according to the latest data from the Mortgage Bankers Association’s weekly mortgage applications survey for the week ending Jan. 22, 2016.
The MBA noted that this week’s results include an adjustment for the Martin Luther King holiday.
The refinance index increased 11% from the previous week, while the seasonally adjusted purchase index increased 5% from one week earlier.
Overall, the refinance share of mortgage activity decreased to 59% of total applications from 59.1% the previous week, as the adjustable-rate mortgage share of activity increased to 6.9% of total applications.
The Federal Housing Administration share of total applications declined to 12.7% from 13.7% the week prior. The Veteran Affair’s share of total applications increased to 11.1% from 10.8% the week prior. The United State Department of Agriculture share of total applications remained frozen at 0.7%.
The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($417,000 or less) reached its lowest level since October 2015, dropping to 4.02%, from 4.06%.
Also falling, the average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances (greater than $417,000) decreased to 3.89% from 3.93%.
The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA decreased from 3.86% to 3.83%.
The average contract interest rate for 15-year fixed-rate mortgages decreased to 3.28% from 3.29%, while the average contract interest rate for 5/1 ARMs fell to 3.09% from 3.20%.