Rebounding from a week with a holiday, mortgage applications increased 6.6% last week from a week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey.
The survey for the week ending June 10, 2022, are compared to the prior week, which included an adjustment for the Memorial Day holiday, the MBA said.
The Market Composite Index, a measure of mortgage loan application volume, increased 6.6% on a seasonally adjusted basis from the previous week, MBA said. On an unadjusted basis, the index increased 17% compared with the previous week.
Both the Refinance and Purchase indices increased from a week earlier, but remain significantly lower as compared with last year.
The Refinance Index increased 4% from the previous week, but was 76% lower than the same week last year.
The seasonally adjusted Purchase Index increased 8% from a week earlier, while the unadjusted Purchase Index increased 18% compared with the previous week and was 16% lower than the same week last year.
"Mortgage rates increased for all loan types, with the 30-year fixed rate last week jumping 25 basis points to 5.65% — the highest level since 2008,” Joel Kan, MBA’s associate vice president of economic and industry forecasting, said. “Mortgage rates followed Treasury yields up in response to higher-than-expected inflation and anticipation that the Federal Reserve will need to raise rates at a faster pace.”
Despite the increase in rates, Kan noted, “application activity rebounded following the Memorial Day holiday week, but remained 0.29% below pre-holiday levels. With mortgage rates well above 5%, refinance activity continues to run more than 70% lower than last year.”
He added, “Purchase applications were down more than 15% compared to last year, as ongoing inventory shortages and affordability challenges have cooled demand, coinciding with the rapid jump in mortgage rates.”
The refinance share of mortgage activity decreased to 31.7% of total applications from 32.2% the previous week.
Other highlights:
- The adjustable-rate mortgage (ARM) share of activity decreased to 8.1% of total applications.
- The FHA share of total applications increased to 11.8% from 11.3% the previous week.
- The VA share of total applications increased to 11.7% from 11.4% the previous week.
- The USDA share of total applications increased to 0.6% from 0.5% the previous week.
The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($647,200 or less) increased to 5.65% from 5.4%, with points increasing to 0.71 from 0.60 (including the origination fee) for 80% loan-to-value ratio (LTV) loans. The effective rate increased from last week.
The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA increased to 5.36% from 5.3%, with points increasing to 1.00 from 0.79 (including the origination fee) for 80% LTV loans. The effective rate increased from last week.
The average contract interest rate for 15-year fixed-rate mortgages increased to 4.79% from 4.62%, with points increasing to 0.80 from 0.65 (including the origination fee) for 80% LTV loans. The effective rate increased from last week.
MBA’s Weekly Applications Survey covers over 75% of all U.S. retail residential mortgage applications, and has been conducted weekly since 1990. Respondents include mortgage bankers, commercial banks, and thrifts. Base period and value for all indexes is March 16, 1990=100.
