Government Purchase Loans Drive Increase in MBA Weekly Survey
Mortgage applications increased slightly from one week earlier, driven by an increase in government purchase loans and a slight decrease in key interest rates, the Mortgage Bankers Association reported this morning in its Weekly Mortgage Applications Survey for the week ending August 21.
The Market Composite Index increased by 0.2 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index decreased by 1 percent compared to the previous week.
The Refinance Index decreased by 1 percent from the previous week. The refinance share of mortgage activity decreased to 55.3 percent of total applications from 55.5 percent the previous week.
The seasonally adjusted Purchase Index increased by 2 percent from one week earlier. The unadjusted Purchase Index decreased by 0.3 percent compared to the previous week and was 18 percent higher than the same week one year ago.
Applications for government home purchase loans drove the increase; the seasonally adjusted FHA purchase index rose by 5.6 percent from the previous week while the seasonally adjusted VA purchase index rose by 5.2 percent over the week. Conventional purchase applications were essentially unchanged from the previous week. The FHA share of total applications increased to 13.1 percent from 12.9 percent the week prior. The VA share of total applications increased to 11.4 percent from 11.1 percent the week prior. The USDA share of total applications remained unchanged at 0.8 percent from the week prior.
The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($417,000 or less) decreased to 4.08 percent from 4.11 percent, with points decreasing to 0.36 from 0.37 (including origination fee) for 80 percent loan-to-value ratio 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 $417,000) decreased to 4.00 percent from 4.03 percent, with points decreasing to 0.24 from 0.29 (including origination fee) for 80 percent LTV loans. The effective rate decreased from last week.
The average contract interest rate for 30-year fixed-rate mortgages backed by FHA increased to 3.90 percent from 3.88 percent, with points increasing to 0.21 from 0.17 (including origination fee) for 80 percent LTV loans. The effective rate increased from last week.
The average contract interest rate for 15-year fixed-rate mortgages decreased to 3.33 percent from 3.37 percent, with points decreasing to 0.31 from 0.36 (including origination fee) for 80 percent LTV loans. The effective rate decreased from last week.
The average contract interest rate for 5/1 adjustable-rate mortgages decreased to 2.96 percent from 2.98 percent, with points decreasing to 0.36 from 0.40 (including origination fee) for 80 percent LTV loans. The effective rate decreased from last week.
The ARM share of activity decreased to 6.8 percent of total applications.
The survey covers more than 75 percent of all U.S. retail and consumer direct residential mortgage applications and has been conducted weekly since 1990. Respondents include mortgage bankers, commercial banks and thrifts.
