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The Mortgage Bankers Association's Weekly Mortgage Application Survey reported a 2.2% decline in mortgage applications for the week ending March 12, 2021. On an unadjusted basis, the Market Composite Index decreased by 2%.
The MBA also reported that the Refinance Index dipped by 4% and was 39% lower year-over-year. The seasonally adjusted Purchase Index increased 2% from the previous week. On an unadjusted basis, the Purchase Index increased 3% and was 5% higher year-over-year.
"Mortgage application activity was mixed last week, as the run-up in rates continues to reduce incentives for potential refinance borrowers. The 30-year fixed-rate increased to its highest level since June 2020, and all other surveyed rates were either flat or increased," said Joel Kan, MBA's associate vice president of Economic and Industry Forecasting. "After reaching a recent high in the last week of January, the refinance index has since fallen 26% to its lowest level since September 2020. Rates have jumped 36 basis points since the end of January, and last week refinance activity fell across all loan types."
"The purchase market helped offset the slump in refinances. Activity was up 5% from a year ago, as the recovering job market and demographic factors drive demand, despite ongoing supply and affordability constraints," added Kan.
According to the report, the refinance share of mortgage activity decreased to 62.9% from 64.5% in the previous week and the adjustable-rate mortgage share decreased to 2.7% of total applications.
Meanwhile, the FHA share of total applications increased to 11.7% from 11.6%, the VA share decreased to 10.3% from 11.1% last week and the USDA share remained stagnant at 0.4%.
Click here to read more from the MBA's WMAS.