Mortgage Applications Down in MBA Weekly Survey

MBA NewsLink Staff

April 17, 2019

Mortgage applications fell for the second time week in a row as interest rates crept higher, the Mortgage Bankers Association reported this morning in its Weekly Mortgage Applications Survey for the week ending April 12.

The Market Composite Index decreased by 3.5 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index decreased by 3 percent compared to the previous week.

The (unadjusted) Refinance Index decreased by 8 percent from the previous week. The refinance share of mortgage activity decreased to 41.5 percent of total applications from 44.1 percent the previous week.

The seasonally adjusted Purchase Index increased by 1 percent from one week earlier. The unadjusted Purchase Index increased by 2 percent compared to the previous week and was 7 percent higher than the same week one year ago.

"Mortgage applications decreased over the week, driven by a decline in refinances," said Joel Kan, MBA Associate Vice President of Economic and Industry Forecasting. "With mortgage rates up for the second week in a row, it's no surprise that refinancings slid 8 percent and average loan sizes dropped back closer to normal levels."

Kan noted purchase activity remained strong and increased slightly, reaching its highest level since April 2010. "The spring buying season continues to be robust, with activity more than 7 percent higher than a year ago and up year-over-year for the ninth straight week," he said.

MBA reported the FHA share of total applications decreased to 9.4 percent from 9.6 percent the week prior. The VA share of total applications increased to 11.6 percent from 11.1 percent the week prior. The USDA share of total applications remained unchanged from 0.6 percent the week prior.

MBA said the average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($484,350 or less) increased to 4.44 percent from 4.40 percent, with points decreasing to 0.42 from 0.47 (including origination fee) for 80 percent loan-to-value ratio 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 $484,350) increased to 4.33 percent from 4.28 percent, with points decreasing to 0.23 from 0.28 (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 4.43 percent from 4.42 percent, with points increasing to 0.56 from 0.48 (including 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 3.84 percent from 3.83 percent, with points increasing to 0.45 from 0.42 (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 3.88 percent from 3.78 percent, with points decreasing to 0.19 from 0.26 (including origination fee) for 80 percent LTV loans. The effective rate increased from last week.

The ARM share of activity decreased to 6.6 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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