Mortgage Applications Decline as Interest Rates Jump

Last week’s mortgage application activity fell by a similar amount as the previous week as a jump in mortgage rates lead to a hefty decline in refinance applications according to the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending August 16th, 2013.

The Market Composite Index, which measures mortgage loan application volume including purchase applications and refinance applications, declined 4.6 percent last week and follows a 4.7 percent decrease from the week before.

On an unadjusted basis, mortgage loan application volume fell five percent from the previous week after falling by the same amount the week before.

Purchase Applications:

The seasonally adjusted Purchase Index increased one percent after posting a five percent decline the week before. The unadjusted Purchase Index was 0.4 percent lower than the previous week but was still five percent higher than during the same period last year.

Refinance Applications:

The Refinance Index declined by eight percent from the previous week after falling four percent the week before. Refinance activity has fallen by just over 62 percent since the beginning of May when mortgage interest rates began to climb. The refinance share of mortgage activity fell to 62 percent of total applications after remaining at 63 percent for the previous four weeks.

Mortgage Interest Rates:
 

Average Contract Mortgages Rates
(80% loan-to-value)

Type of
Loan

Interest Rate (%)

Points

Effective Rate

Current

Previous

Current

Previous

30-Year FRM Conforming
($417,500 or less)

4.68

4.56

0.42

0.39

Increased

30-Year FRM Non-Conforming
($417,501 or more)

4.74

4.57

0.28

0.25

Increased

15-Year FRM

3.71

3.60

0.32

0.35

Increased

FHA 30-Year

4.40

4.25

0.21

0.30

Increased
5/1 ARM

3.44

3.36

0.48

0.37

Increased

 
The adjustable-rate mortgage (ARM) share of activity remained at around six percent of total applications.

Tags: MBA, home purchase applications, mortgage rates, fixed rate mortgage, adjustable rate mortgage, refinance, interest rate, FHA mortgage rates

Source:
Mortgage Bankers Association

Reported by Chris Moore