Mortgage applications continued their modest downward track during the week ended August
19. The Mortgage Bankers Association
said its Market Composite Index, a measure of application volume, fell 2.1
percent on a seasonally adjusted basis from the previous week, the fourth out
of five weeks it has declined. The Index
was down 3 percent on an unadjusted basis.
The share of applications that were for
refinancing slipped to 62.2 percent from 62.6 percent and the Refinance Index
decreased 3 percent from the previous week. The seasonally adjusted Purchase
Index lost 0.3 percent and the unadjusted Purchase Index was down 2 percent compared
with the week ended August 12. Purchases
were 8 percent higher than during the same week in 2015.
Refi Index vs 30yr Fixed
Purchase Index vs 30yr Fixed
The FHA share of total applications was
down to 8.9 percent from 9.6 percent while VA applications eased back from the
previous week’s 13.2 percent share to 12.4 percent. The USDA share of total
applications remained at 0.6 percent.
Rates rose for all fixed-rate mortgages
(FRM) on both a contract and an effective basis. The average contract interest rate for
30-year FRM with conforming loan balances ($417,000 or less) increased to 3.67
percent from 3.64 percent. Points rose to
0.34 from 0.31.
The jumbo version of the 30-year FRM jumbo
loan, mortgages with balances greater than $417,000, increased to 3.62 percent
from 3.60 percent. Points averaged 0.35 compared
to an earlier 0.28.
FHA backed 30-year FRM had an average rate
of 3.53 percent with 0.34 points. The
previous week the rate was 3.49 percent with 0.28 point
Rates for the 15-year FRM rose by 5 basis
points to 2.95. Points averaged 0.38
compared to 0.32 the prior week.
The average contract interest rate for 5/1
adjustable rate mortgages (ARMs) was down slightly, from 2.85 percent the
previous week to 2.84 percent. Points,
however, rose significantly, to 0.37 from 0.17, pushing the effective rate
higher. The ARM share of activity
remained unchanged at 4.6 percent of total applications.
MBA’s Weekly Mortgage Applications Survey
is conducted among mortgage bankers, commercial banks, and thrifts. The survey was initiated in 1990 and covers
over 75 percent of all U.S. retail residential mortgage applications. Base
period and value for all indexes is March 16, 1990=100 and interest rate
information presumes loans with an 80 percent loan to value ratio and points
that include the origination fee.