Mortgage applications increased 5.3 percent from one week earlier, according to the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending April 7.
The Market Composite Index, a measure of mortgage loan application volume, increased 5.3 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index increased 6 percent compared with the previous week. The Refinance Index increased 0.1 percent from the previous week and was 57 percent lower than the same week one year ago.
The seasonally adjusted Purchase Index increased 8 percent from one week earlier. The unadjusted Purchase Index increased 9 percent compared with the previous week and was 31 percent lower than the same week one year ago.
“Incoming data last week showed that the job market is beginning to slow, which led to the 30-year fixed rate decreasing to 6.30 percent – the lowest level in two months,” Mike Fratantoni, MBA senior vice president and chief economist, said in a release. “Prospective homebuyers this year have been quite sensitive to any drop in mortgage rates, and that played out last week with purchase applications increasing by 8 percent.”
Fratantoni called refinance application volume a mixed bag with total volume essentially flat, conventional volume down for the week, but VA refinance volume increasing.
“The level of refinance activity remains almost 60 percent below last year, as most homeowners are currently locked in at much lower rates,” he said.
The refinance share of mortgage activity decreased to 27 percent of total applications from 28.6 percent the previous week. The adjustable-rate mortgage share of activity decreased to 6 percent of total applications.
Federal Housing Administration’s share of total applications increased to 12.3 percent from 12 percent the week prior. Department of Veterans Affairs’ share of total applications increased to 12.8 percent from 11 percent the week prior. U.S. Department of Agriculture total applications decreased to 0.5 percent from 0.6 percent the week prior, according to MBA.
Newest MBA data also shows the average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($726,200 or less) decreasing to 6.30 percent from 6.40 percent, with points decreasing to 0.55 from 0.59 (including the origination fee) for 80 percent loan-to-value ratio loans. The effective rate decreased from the previous week.
The average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances (greater than $726,200) decreased to 6.26 percent from 6.36 percent, with points decreasing to 0.42 from 0.47 (including the origination fee) for 80 percent LTV loans. The effective rate decreased week-over-week.