MBA Weekly Applications Survey Sept. 8, 2021: Volume at Two-Month Low

Mortgage applications fell for the second straight week to their lowest level sine mid-July, the Mortgage Bankers Association reported Wednesday in its Weekly Mortgage Applications Survey for the week ending September 3. 

The Market Composite Index fell by 1.9 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index decreased by 3 percent from the previous week. 

The unadjusted Refinance Index decreased by 3 percent from the previous week and was 4 percent lower than the same week one year ago. The refinance share of mortgage activity remained unchanged at 66.8 percent of total applications from 66.8 percent the previous week.

The seasonally adjusted Purchase Index decreased by 0.2 percent from one week earlier. The unadjusted Purchase Index decreased by 3 percent from the previous week and was 18 percent lower than the same week one year ago.

“Mortgage rates have stayed just above 3% for several weeks,” said MBA Chief Economist Mike Fratantoni. “Refinance volume has been moderating, while purchase volume continues to be lower than expected given the lack of homes on the market. Economic data has sent mixed signals, with slower job growth but a further drop in the unemployment rate in August.”

Fratantoni said MBA expects further improvements will lead to a tapering of Federal Reserve mortgage-backed securities purchases by the end of the year, “which should put some upward pressure on mortgage rates.”

MBA reported the FHA share of total applications decreased to 10.9 percent from 11.2 percent the week prior. The VA share of total applications increased to 10.4 percent from 9.7 percent the week prior. The USDA share of total applications remained unchanged from 0.5 percent the week prior.

The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($548,250 or less) remained unchanged at 3.03 percent, with points decreasing to 0.33 from 0.34 (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 $548,250) increased to 3.14 percent from 3.13 percent, with points increasing to 0.30 from 0.26 (including origination fee) for 80 percent LTV loans. The effective rate increased from last week.

The average contract interest rate for 30-year fixed-rate mortgages backed by FHA decreased to 3.07 percent from 3.09 percent, with points increasing to 0.30 from 0.25 (including origination fee) for 80 percent LTV loans. The effective rate decreased from last week.

The average contract interest rate for 15-year fixed-rate mortgages decreased to 2.37 percent from 2.39 percent, with points decreasing to 0.26 from 0.30 (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 2.56 percent from 2.80 percent, with points increasing to 0.17 from 0.13 (including origination fee) for 80 percent LTV loans. The effective rate decreased from last week.

The ARM share of activity decreased to 2.5 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.