Mortgage Applications Increase In Latest MBA Weekly Survey
Where does it end? Mortgage applications continue their upward path with the latest Mortgage Bankers Association weekly survey showing a 5.1% hike.
The Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending July 10, 2020 showed the Market Composite Index, a measure of mortgage loan application volume, increased 5.1% on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index increased 16%.
The Refinance Index increased 12% from the previous week and was 107% higher than the same week one year ago. The seasonally adjusted Purchase Index decreased 6% from one week earlier. The unadjusted Purchase Index increased 5% compared with the previous week and was 16% higher than the same week one year ago.
The refinance share of mortgage activity increased to 64.2% of total applications from 60.1% the previous week. The adjustable-rate mortgage (ARM) share of activity decreased to 3.0% of total applications.
“Mortgage rates continued their downward trend, with the 30-year fixed rate falling 7 basis points to 3.19% – another record low in MBA’s survey and 63 basis points lower than the recent high in late March. The drop in rates led to a jump in refinance activity to the highest level in a month, with refinance loan balances also climbing to a high last seen in March,” said Joel Kan, MBA’s associate vice president of economic and industry forecasting.
“Purchase applications fell over the week but remained 15% higher than a year ago – the eighth consecutive week of year-over-year increases. Purchase activity remains relatively strong, despite the continued economic uncertainty and high unemployment caused by the ongoing pandemic.”
The Federal Housing Authority share of total applications increased to 11.1% from 10.9% the week prior. The VA share of total applications increased to 11.0% from 10.4% the week prior. The USDA share of total applications decreased to 0.6% from 0.7% the week prior.
The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($510,400 or less) decreased to 3.19% from 3.26%, with points decreasing to 0.33 from 0.35 (including the origination fee) for 80% loan-to-value ratio (LTV) loans. The effective rate decreased from last week.
The average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances (greater than $510,400) increased to 3.53% from 3.52%, with points decreasing to 0.29 from 0.36 (including the origination fee) for 80% LTV loans. The effective rate decreased from last week.