Mortgage Applications Increase in Latest MBA Weekly Survey

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Adam DeSanctis
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WASHINGTON, D.C. (October 27, 2021)Mortgage applications increased 0.3 percent from one week earlier, according to data from the Mortgage Bankers Association's (MBA) Weekly Mortgage Applications Survey for the week ending October 22, 2021. 

The Market Composite Index, a measure of mortgage loan application volume, increased 0.3 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index increased 0.2 percent compared with the previous week. The Refinance Index decreased 2 percent from the previous week and was 26 percent lower than the same week one year ago. The seasonally adjusted Purchase Index increased 4 percent from one week earlier. The unadjusted Purchase Index increased 3 percent compared with the previous week and was 9 percent lower than the same week one year ago.  

"Mortgage rates increased again last week, as the 30-year fixed rate reached 3.30 percent and the 15-year fixed rate rose to 2.59 percent - the highest for both in eight months. The increase in rates triggered the fifth straight decrease in refinance activity to the slowest weekly pace since January 2020. Higher rates continue to reduce borrowers' incentive to refinance," said Joel Kan, MBA's Associate Vice President of Economic and Industry Forecasting. "Purchase applications picked up slightly, and the average loan size rose to its highest level in three weeks, as growth in the higher price segments continues to dominate purchase activity. Both new and existing-home sales last month were at their strongest sales pace since early 2021, but first-time home buyers are accounting for a declining share of activity. Home prices are still growing at a rapid clip, even if monthly growth rates are showing signs of moderation, and this is constraining sales in many markets, and particularly for first-timers."

The refinance share of mortgage activity decreased to 62.2 percent of total applications from 63.3 percent the previous week. The adjustable-rate mortgage (ARM) share of activity decreased to 3.1 percent of total applications.

The FHA share of total applications increased to 10.4 percent from 10.2 percent the week prior. The VA share of total applications increased to 10.6 percent from 10.4 percent the week prior. The USDA share of total applications remained unchanged from 0.5 percent the week prior.  

The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($548,250 or less) increased to 3.30 percent from 3.23 percent, with points decreasing to 0.34 from 0.35 (including the origination fee) for 80 percent loan-to-value ratio (LTV) loans. The effective rate increased from last week.  

The average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances (greater than $548,250) increased to 3.34 percent from 3.26 percent, with points decreasing to 0.29 from 0.33 (including the origination fee) for 80 percent LTV loans. The effective rate increased from last week.  

The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA increased to 3.31 percent from 3.17 percent, with points increasing to 0.38 from 0.32 (including the origination fee) for 80 percent LTV loans. The effective rate increased from last week.  

The average contract interest rate for 15-year fixed-rate mortgages increased to 2.59 percent from 2.54 percent, with points increasing to 0.33 from 0.29 (including the origination fee) for 80 percent LTV loans. The effective rate increased from last week.  

The average contract interest rate for 5/1 ARMs decreased to 2.89 percent from 3.09 percent, with points decreasing to 0.13 from 0.30 (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.