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Mortgage Applications Fall 3.1% From The Previous Week

Katie Jensen
Jun 09, 2021

With fewer homeowners able to take advantage of lower rates, the refinance share dipped to the lowest level since April.

KEY TAKEAWAYS
  • Mortgage applications fell by 3.1% on an adjusted basis. On an unadjusted basis, the Index decreased 13% compared to the previous week. 
  • The Refinance Index decreased 5% from the previous week and fell by 27% year-over-year.
  • The Purchase Index increased by 0.3% from a week earlier.
  • The average contract interest rate for 30-fixed-rate mortgages with conforming loan balances decreased to 3.29% from 3.34% a week earlier.

For the week ending on June 4, 2021, mortgage applications fell by 3.1%, according to the Mortgage Bankers Association (MBA) Weekly Mortgage Applications Survey. These results are adjusted for the Memorial Day holiday. On an unadjusted basis, the Index decreased 13% compared to the previous week. 

The Refinance Index decreased 5% from the previous week and fell by 27% year-over-year. The Purchase Index increased by 0.3% from a week earlier; however, the unadjusted purchase index decreased 11% compared to a week earlier and was 24% lower from the same week last year. 

The refinance share of mortgage activity decreased to 60.4% of total applications from 61.3% a week earlier. The adjustable-rate mortgage (ARM) share of activity increased to 3.9% of total applications. The Federal Housing Administration share of total applications fell to 9.5% from 9.6% the previous week. The VA share of total applications increased to 11.2% from 10.9% the week prior. The USDA share of applications remained unchanged at 0.4%. 

Joel Kan, MBA's associate vice president of economic and industry forecasting, said, “Most of the decline in mortgage rates came late last week, with the 30-year fixed-rate mortgage declining to 3.15 percent. This likely impacted refinance applications, which fell 5 percent for both conventional and government loans. With fewer homeowners able to take advantage of lower rates, the refinance share dipped to the lowest level since April.”

The average contract interest rate for 30-fixed-rate mortgages with conforming loan balances decreased to 3.29% from 3.34% a week earlier. Points decreased from 0.38 to 0.32 for 80% LTV loans. 

The average contract interest rate for 30-year-fixed loans backed by the FHA decreased to 3.12 percent from 3.16 percent, with points increasing to 0.34 from 0.31 for 80% LTV loans. 

The Weekly Mortgage Applications Survey covers 75% of all U.S. retail residential mortgage applications. To subscribe and read the survey, click here

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