Fewer people were finding their way into loan originator offices for the week ending July 12, according to data from the Mortgage Bankers Association (MBA).
The Market Composite Index was down by a mild 1.1 percent on a seasonally adjusted basis from one week earlier, but the unadjusted index rose by a robust 24 percent compared with the previous week. The seasonally adjusted Purchase Index decreased four percent from one week earlier while the unadjusted index was up 21 percent compared with the previous week and was seven percent higher than the same week one year ago. The Refinance Index increased two percent from the previous week and was 87 percent higher than the same week one year ago, while refinance share of mortgage activity increased to 50.0 percent of total applications from 48.7 percent the previous week.
Among the federal programs, the FHA share of total applications increased to 10.6 percent from 10.1 percent the week prior while the VA share of total applications decreased to 12.9 percent from 13.2 percent and the USDA share of total applications decreased to 0.6 percent from 0.7 percent.
“Mortgage rates increased across the board, with the 30-year fixed rate mortgage rising to its highest level in a month to 4.12 percent, which is still below this year’s average of 4.45 percent,” said Joel Kan, MBA’s Associate Vice President of Economic and Industry Forecasting. “Coming out of the July 4th holiday, applications were lower overall, with purchase activity slipping almost four percent. Refinance applications increased, with activity reaching its highest level in a month, driven mainly by FHA applications. Historically, government refinance activity lags slightly in response to rate changes. Buyer interest at the start of the second half of the year continues to outpace year ago levels, with activity last week up seven percent.”
As for homeowners who hold mortgages, there was good news from the S&P/Experian Consumer Credit Default Indices: The first mortgage default rate of 0.59 percent was unchanged from May to June.
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