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MBA: Mortgage Applications Continue To Subside

Sarah Wolak
Jul 13, 2022
Mortgage Bankers Association Logo

In latest weekly survey, applications decreased 1.7% from one week earlier.

KEY TAKEAWAYS
  • The Refinance Index increased 2% from the previous week, but was 80% lower than the same week one year ago. 
  • The refinance share of mortgage activity moved slightly upwards to 30.8% of total applications from 29.6% the previous week.

Mortgage applications decreased 1.7% from a week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending July 8, 2022.

On an unadjusted basis, the Index decreased 13% compared with the previous week. The Refinance Index increased 2% from the previous week, but was 80% lower than the same week last year. 

The seasonally adjusted Purchase Index decreased 4% from one week earlier. The unadjusted Purchase Index decreased 14% compared with the previous week and was 18% lower than the same week one year ago.

“Mortgage rates were mostly unchanged, but applications declined for the second straight week," said Joel Kan, MBA's associate vice president of economic and industry forecasting. "Purchase applications for both conventional and government loans continue to be weaker due to the combination of much higher mortgage rates and the worsening economic outlook.

He continued, “After reaching a record $460,000 in March 2022, the average purchase loan size was $415,000 last week, pulled lower by the potential moderation of home-price growth and weaker purchase activity at the upper end of the market.”

The refinance share of mortgage activity moved slightly upwards to 30.8% of total applications from 29.6% the previous week. The adjustable-rate mortgage (ARM) share of activity increased to 9.6% of total applications.

Multiple decreases showed across the board. The FHA share of total applications decreased to 11.7% from 12% the week prior. The VA share of total applications bumped up to 11.2% from 11.1% the week prior. The USDA share of total applications decreased to 0.5% from 0.6% the week prior.

“Refinance applications increased slightly last week, driven by an uptick in conventional and FHA refinances," Kan said. "The overall refinance index remained 5% below the average level reported in June. With the 30-year fixed rate 265 basis points higher than a year ago, refinance applications are expected to remain depressed.”

Other survey takeaways:

  • The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances — $647,200 or less — remained at 5.7%, with points decreasing to 0.59 from 0.65.
  • The average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances (greater than $647,200), decreased to 5.25% from 5.2%, with points decreasing to 0.38 from 0.44. 
  • The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA decreased to 5.49% from 5.6%, with points increasing to 1.08 from 0.89.  
     
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