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The Mortgage Bankers Association's Weekly Mortgage Application Survey reported a 2.5% decrease in mortgage applications for the week ending Sept. 11, 2020, adjusted for the Labor Day holiday. On an unadjusted basis, the market composite index decreased by 13%.
The refinance index decreased by 4% from the previous week but was still 30% higher than the same week year over year. The purchase index decreased by 1% on a seasonally adjusted basis and 12% on an unadjusted basis.
"Mortgage rates held steady last week, and the 30-year fixed-rate - at 3.07% - has now stayed near the 3% mark for the past two months. A 5% decline in conventional refinances pulled the overall index lower, but activity was still 30% higher than last year. With the flurry of refinance activity reported over the past several months, demand may be slowing as remaining borrowers in the market potentially wait for another sizeable drop in rates," said Joel Kan, MBA's associate vice president of economic and industry forecasting. "Applications to buy a home also decreased last week, but the underlying trend remains strong. Purchase activity has outpaced year-ago levels for 17 consecutive weeks, with a stronger growth in loans with higher balances pushing MBA's average loan size to a new survey high of $370,200."
The refinance share of mortgage activity decreased from 63.1% to 62.8%, the adjustable-rate mortgage share of activity increased to 2.3% of total applications, the FHA share of total applications decreased from 10.2% to 9.7%, the VA share increased from 11.2% to 12.3% and the USDA share decreased from 0.6% to 0.5%.