Total mortgage application volume increases for second week in a row despite uptick in rates
Demand for mortgages increased for the second straight week, spurred by a rebound in both refi and purchase applications.
The Mortgage Bankers Association’s Market Composite Index posted a 2.1% seasonally adjusted gain from the previous week and was up 1% on an unadjusted basis. MBA’s refinance index rose 3% week over week, and the purchase index ticked up 1% from last week.
“Mortgage rates increased last week, with the 30-year fixed rate rising to 3.18% – the highest level in a month. Despite the jump in rates, refinances increased for the second consecutive week, pushed higher by a 4% bump in conventional refinance applications,” said Joel Kan, AVP of economic and industry forecasting at MBA.
Kan added that purchase applications have picked up an upward momentum over the past few weeks.
“Activity was slightly higher for the third straight week but remained lower than the same week a year ago,” he said. “Government purchase applications drove most of last week’s increase, which also contributed to a slightly lower overall average purchase loan size.”
Of total applications, the share of refinance activity increased from 61.7% to 62.5% week over week, and the adjustable-rate mortgage (ARM) share of activity increased to 3.9%.
The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($548,250 or less) climbed from 3.11% to 3.18%, with points increasing from 0.36 to 0.48 (including the origination fee) for 80% loan-to-value ratio (LTV) loans.
