Overall mortgage applications declined last week
There was a 2.5% decrease in mortgage applications last week even though 30-year FRM rates eased. The decline from a week earlier included adjustment for the Martin Luther King Jr. Day holiday.
The Mortgage Bankers Association’s Weekly Mortgage Applications Survey for week ending February 1 shows that purchase loans continued to slow even as rates improved.
"Mortgage rates for all loan types declined last week, with the 30-year fixed mortgage rate falling seven basis points to 4.69% - the lowest rate since April 2018," said Joel Kan, Associate Vice President of Industry Surveys and Forecasts. "Despite more favorable borrowing costs, and after a three-week surge in activity, purchase applications have slowed over the past two weeks, and are now almost 2 percent lower than a year ago.”
Kan does not expect purchase applications to remain subdued though with moderating price gains and the strong job market, including evidence of faster wage growth.
"Refinance applications saw a very slight increase compared to the previous week, despite the broad decline in rates," he added.
Market Composite Index
The overall index – a measure of mortgage loan application volume - decreased 2.5% (seasonally adjusted) and increased 12% (unadjusted).
The Refinance Index increased 0.3% from the previous week while the Purchase Index decreased 5% (adjusted) and increased 13% (unadjusted). It was 2% lower than the same week one year ago.
Refinances made up 41.6% of total applications, down from 42% a week earlier.
The adjustable-rate mortgage (ARM) share of activity decreased to 7.8% of total applications.
More stats
The FHA share of total applications remained unchanged from 10.5% the week prior. The VA share of total applications decreased to 10.0% from 10.7% the week prior. The USDA share of total applications increased to 0.5% from 0.4% the week prior.
The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($484,350 or less) decreased to 4.69% from 4.76%, with points decreasing to 0.45 from 0.47 (including the origination fee) for 80% loan-to-value ratio (LTV) loans. The effective rate decreased from last week.
The average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances (greater than $484,350) decreased to 4.50% from 4.60%, with points increasing to 0.28 from 0.24 (including the origination fee) for 80% LTV loans. The effective rate decreased from last week.
The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA decreased to 4.70% from 4.77%, with points decreasing to 0.57 from 0.58 (including the origination fee) for 80% LTV loans. The effective rate decreased from last week.
The average contract interest rate for 15-year fixed-rate mortgages decreased to 4.11% from 4.16%, with points increasing to 0.47 from 0.46 (including the origination fee) for 80% LTV loans. The effective rate decreased from last week.
The average contract interest rate for 5/1 ARMs decreased to 4.04% from 4.14%, with points remaining unchanged from 0.37 (including the origination fee) for 80% LTV loans. The effective rate decreased from last week.
