Mortgage applications fell 4.8% last week, according to a report from the Mortgage Bankers Association.
The refinance index also experienced a 7% decline, driven by a 9% drop in conventional refinance applications, said Joel Kan, MBA’s associate vice president of economic and industry forecasting. However, refinances remained 52% higher than the same week one year ago.
The refinance share of mortgage activity also faltered slightly, dropping to 63.3% of total applications from 64.3% the week prior.
According to Kan, the decline in refinances may have been impacted by refinance rates that are not decreasing to the same extent as rates for home purchase loans.
“Many lenders are still operating at full capacity and working through operational challenges, ultimately limiting the number of applications they are able to accept,” Kan said.
On an unadjusted basis, purchase applications fell 2% compared with the previous week and were 22% higher than the same week one year ago – marking the 19th straight week of year-over-year gains.
In the midst of the negative activity, mortgage rates decreased last week, with the 30-year fixed rate mortgage declining 5 basis points to 3.05% – the lowest in MBA’s survey, according to Kan
The adjustable-rate mortgage (ARM) share of activity remained unchanged at 2.2% of total applications.
Here is a more detailed breakdown of this week’s mortgage application data:
- The FHA’s share of mortgage apps rose to 11.4% from 10.1%.
- The VA share of applications fell to 11.9% from 12%.
- The USDA share of total applications fell to 0.5% from 0.6%.
- The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($510,400 or less) fell to 3.05% from 3.1%.
- The average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances (greater than $510,400) fell to 3.33% from 3.35%.
- The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA fell to 3.15% from 3.23%.
- The average contract interest rate for 15-year fixed-rate mortgages rose to 2.65% from 2.64%.
- The average contract interest rate for 5/1 ARMs fell to 2.95% from 3.19%.