Mortgage applications decreased 2.5% last week after seeing some positivity the week prior, according to a report from the Mortgage Bankers Association.
The refinance index decreased 4% compared to the week prior but remains 30% higher than the same week last year.
According to Joel Kan, MBA’s associate vice president of economic and industry forecasting, demand for refinances may be slowing due to remaining borrowers waiting for another sizable drop in rates.
Purchase applications decreased slightly by 1% from the week prior on a seasonally adjusted basis, while the unadjusted purchase index decreased 12% compared to the week prior. However, the purchase index was 6% higher than the same week last year.
“Applications to buy a home also decreased last week, but the underlying trend remains strong,” Kan said. “Purchase activity has outpaced year-ago levels for 17 consecutive weeks, with a stronger growth in loans with higher balances pushing MBA’s average loan size to a new survey high of $370,200.”
The adjustable-rate mortgage (ARM) share of activity increased to 2.3% of total applications.
Here is a more detailed breakdown of this week’s mortgage application data:
- The FHA’s share of mortgage apps decreased to 9.7% from 10.2% the week prior.
- The VA share of applications increased to 12.3% from 11.2% the week prior.
- The USDA share of total applications decreased to 0.5% from 0.6% the week prior.
- The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($510,400 or less) remained unchanged at 3.07%.
- The average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances (greater than $510,400) increased to 3.41% from 3.40% the week prior.
- The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA remained unchanged at 3.16%.
- The average contract interest rate for 15-year fixed-rate mortgages decreased to 2.61% from 2.62% the week prior.
- The average contract interest rate for 5/1 ARMs increased to 3.20% from 2.99% the week prior.