Mortgage application volume decreased this week
According to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending March 8, mortgage application volume dropped 4.7 percent from the previous week, with the Association citing higher interest rates as the primary reason.
The Market Composite Index fell 4.7 percent on a seasonally adjusted basis from one week earlier, but on an unadjusted basis, the Index decreased 4 percent compared with the previous week.
The Refinance Index decreased 5.0 percent from the previous week, while the seasonally adjusted Purchase Index decreased 3.0 percent from one week earlier. The unadjusted Purchase Index decreased 1.0 percent compared with the previous week and was a full 9.0 percent higher than the same week one year ago.
Refinances hit by interest rate shift
“The announcement of stronger than anticipated job growth last week led to an increase in interest rates, with the 30 year fixed mortgage rate in our survey reaching the highest level in more than six months,” said Mike Fratantoni, MBA’s Vice President of Research and Economics. “Refinance applications declined as a result, but remain high given the steady flow of HARP applications.”
The MBA reports that the refinance share of mortgage activity fell to 76 percent of total applications, down one percent from the previous week, hitting the lowest level since May 2012 as the refinance share has hovered between 80 and 81 percent for months. The adjustable-rate mortgage (ARM) share of activity increased to 5.0 percent of total applications and the HARP share of refinance applications increased to 30 percent from 28 percent.
Average contract interest rates
According to the report:
- The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($417,500 or less) increased to 3.81 percent, the highest rate since August 2012, from 3.70 percent, with points remaining unchanged at 0.39 (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 $417,500) increased to 3.90 percent from 3.80 percent, with points increasing to 0.46 from 0.37 (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 3.53 percent from 3.47 percent, with points increasing to 0.38 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 15-year fixed-rate mortgages increased to 3.01 percent from 2.96 percent, with points increasing to 0.42 from 0.36 (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 increased to 2.62 percent from 2.55 percent, with points decreasing to 0.33 from 0.37 (including the origination fee) for 80 percent LTV loans. The effective rate increased from last week.
