Applications Down Slightly in MBA Weekly Survey

MBA NewsLink Staff

July 05, 2018


Mortgage applications fell for the second straight week, despite an uptick in purchase applications, the Mortgage Bankers Association reported this morning in its Weekly Mortgage Applications Survey for the week ending June 29.

The Market Composite Index decreased by 0.5 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index decreased by 1 percent compared to the previous week.

The (unadjusted) Refinance Index decreased by 2 percent from the previous week. The refinance share of mortgage activity decreased to 37.2 percent of total applications from 37.6 percent the previous week.

The seasonally adjusted Purchase Index increased by 1 percent from one week earlier. The unadjusted Purchase Index remained unchanged from the previous week and was 1 percent lower than the same week one year ago. Despite the increase, purchase application volume fell below that of a year ago.

The FHA share of total applications remained unchanged at 10.2 percent from the week prior. The VA share of total applications remained unchanged at 10.7 percent from the week prior. The USDA share of total applications remained unchanged at 0.8 percent from the week prior.

"Financial market volatility in response to continued worries about trade resulted in both lower mortgage rates and a drop in applications last week," said MBA Chief Economist Mike Frantantoni. "The refinance index dropped below 1000 again last week, one of the weakest readings in the last 20 years."

Fratantoni noted purchase application volume fell below last year's level, led by a decline in applications for conventional purchase loans. "A shortage of inventory remains a significant constraint, but it is interesting to note that applications for government purchase loans fared better on the week, indicating that first-time buyers remain in the market," he said.

MBA reported the average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($453,100 or less) decreased to 4.79 percent from 4.84 percent, with points decreasing to 0.41 from 0.42 (including origination fee) for 80 percent loan-to-value ratio 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 $453,100) increased to 4.71 percent from 4.70 percent, with points increasing to 0.43 from 0.26 (including 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 FHA decreased to 4.78 percent from 4.81 percent, with points increasing to 0.73 from 0.69 (including 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 4.22 percent from 4.29 percent, with points increasing to 0.47 from 0.40 (including origination fee) for 80 percent LTV loans. The effective rate decreased from last week.

The average contract interest rate for 5/1 adjustable-rate mortgages increased to 4.03 percent from 4.01 percent, with points decreasing to 0.25 from 0.41 (including origination fee) for 80 percent LTV loans. The effective rate decreased from last week.

The ARM share of activity increased to 6.7 percent of total applications.

The survey covers more than 75 percent of all U.S. retail and consumer direct residential mortgage applications and has been conducted weekly since 1990. Respondents include mortgage bankers, commercial banks and thrifts.

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