Mortgage Applications Increase in Latest MBA Weekly Survey

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Adam DeSanctis
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WASHINGTON, D.C. (July 15, 2020)Mortgage applications increased 5.1 percent from one week earlier, according to data from the Mortgage Bankers Association's (MBA) Weekly Mortgage Applications Survey for the week ending July 10, 2020. Last week's results included an adjustment for the Fourth of July holiday.

The Market Composite Index, a measure of mortgage loan application volume, increased 5.1 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index increased 16 percent compared with the previous week. The Refinance Index increased 12 percent from the previous week and was 107 percent higher than the same week one year ago. The seasonally adjusted Purchase Index decreased 6 percent from one week earlier. The unadjusted Purchase Index increased 5 percent compared with the previous week and was 16 percent higher than the same week one year ago.

"Mortgage rates continued their downward trend, with the 30-year fixed rate falling 7 basis points to 3.19 percent - another record low in MBA's survey and 63 basis points lower than the recent high in late March. The drop in rates led to a jump in refinance activity to the highest level in a month, with refinance loan balances also climbing to a high last seen in March," said Joel Kan, MBA's Associate Vice President of Economic and Industry Forecasting. "Purchase applications fell over the week but remained 15 percent higher than a year ago - the eighth consecutive week of year-over-year increases. Purchase activity remains relatively strong, despite the continued economic uncertainty and high unemployment caused by the ongoing pandemic."

The refinance share of mortgage activity increased to 64.2 percent of total applications from 60.1 percent the previous week. The adjustable-rate mortgage (ARM) share of activity decreased to 3.0 percent of total applications.

The FHA share of total applications increased to 11.1 percent from 10.9 percent the week prior. The VA share of total applications increased to 11.0 percent from 10.4 percent the week prior. The USDA share of total applications decreased to 0.6 percent from 0.7 percent the week prior.

The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($510,400 or less) decreased to 3.19 percent from 3.26 percent, with points decreasing to 0.33 from 0.35 (including the origination fee) for 80 percent loan-to-value ratio (LTV) loans. The effective rate decreased from last week.

The average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances (greater than $510,400) increased to 3.53 percent from 3.52 percent, with points decreasing to 0.29 from 0.36 (including the origination fee) for 80 percent LTV loans. The effective rate decreased from last week.

The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA decreased to 3.24 percent from 3.31 percent, with points increasing to 0.29 from 0.24 (including the origination fee) for 80 percent LTV loans. The effective rate decreased from last week.

The average contract interest rate for 15-year fixed-rate mortgages decreased to 2.70 percent from 2.77 percent, with points decreasing to 0.32 from 0.32 (including the origination fee) for 80 percent LTV loans. The effective rate decreased from last week.

The average contract interest rate for 5/1 ARMs increased to 3.00 percent from 2.98 percent, with points decreasing to 0.02 from 0.10 (including the origination fee) for 80 percent LTV loans. The effective rate decreased from last week. 
 

If you would like to purchase a subscription of MBA's Weekly Applications Survey, please visit www.mba.org/WeeklyApps, contact mbaresearch@mba.org or click here.

The survey covers over 75 percent of all U.S. retail residential mortgage applications, and has been conducted weekly since 1990. Respondents include mortgage bankers, commercial banks and thrifts. Base period and value for all indexes is March 16, 1990=100.