Mortgage Applications Activity Unchanged in MBA Weekly Survey

MBA NewsLink Staff

October 03, 2018

Mortgage applications was unchanged from one week earlier, the Mortgage Bankers Association reported this morning in its Weekly Mortgage Applications Survey for the week ending September 28.

The Market Composite Index remained unchanged on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index decreased by 0.2 percent compared to the previous week.

The (unadjusted) Refinance Index decreased by 0.1 percent from the previous week. The refinance share of mortgage activity remained unchanged at 39.4 percent of total applications from the previous week.

The seasonally adjusted Purchase Index increased by 0.1 percent from one week earlier. The unadjusted Purchase Index decreased by 0.2 percent compared to the previous week and was 3 percent higher than the same week one year ago.

The FHA share of total applications decreased to 10.2 percent from 10.4 percent the week prior. The VA share of total applications decreased to 10.0 percent from 10.1 percent the week prior. The USDA share of total applications remained unchanged at 0.7 percent from the week prior.

"Rates were little changed last week, following the most recent [Federal Open Market Committee] meeting where the Fed announced another rate hike based on the health of the economy and job market as expected, "said MBA Associate Vice President of Economic and Industry Forecasting Joel Kan. "Short-term rates have been increasing but long-term rates have held steady, which should not pose too much of a headwind to home purchase activity, especially given the potential demand from demographic factors."

Kan noted even though applications activity was essentially unchanged from the previous week, purchase applications increased by 3 percent from a year ago. "Even with the slight increase in rates, the 15-year fixed rate reached its highest level since April 2010 and the 30-year jumbo rate increased to its highest rate since July 2011," 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 4.96 percent from 4.97 percent, with points increasing to 0.49 from 0.47 (including origination fee) for 80 percent loan-to-value ratio loans. The effective rate remained unchanged from last week.

The average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances (greater than $453,100) increased to its highest level since July 2011, 4.93 percent, from 4.92 percent, with points increasing to 0.31 from 0.30 (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 increased to its highest level since May 2011, 4.95 percent, from 4.94 percent, with points decreasing to 0.80 from 0.83 (including origination fee) for 80 percent LTV loans. The effective rate remained unchanged from last week.

The average contract interest rate for 15-year fixed-rate mortgages increased to its highest level since April 2010, 4.39 percent, from 4.38 percent, with points decreasing to 0.50 from 0.52 (including origination fee) for 80 percent LTV loans. The effective rate increased from last week.

The average contract interest rate for 5/1 adjustable-rate mortgages increased to its highest level in the history of the survey, 4.24 percent, from 4.22 percent, with points decreasing to 0.48 from 0.60 (including origination fee) for 80 percent LTV loans. The effective rate decreased from last week.

The ARM share of activity increased to 7.1 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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