MBA Weekly Survey Aug. 24, 2022: Applications Fall for 3rd Straight Week

Mortgage applications fell for the third straight week, remaining at their lowest level in 22 years, the Mortgage Bankers Association reported Wednesday in its Weekly Mortgage Applications Survey for the week ending August 19. 

The Market Composite Index fell by 1.2 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 83 percent lower than the same week one year ago. The refinance share of mortgage activity decreased to 31.1 percent of total applications from 31.2 percent the previous week.

The seasonally adjusted Purchase Index decreased by 1 percent from one week earlier. The unadjusted Purchase Index decreased by 2 percent from the previous week and was 21 percent lower than the same week one year ago.

The FHA share of total applications increased to 12.5 percent from 12.0 percent the week prior. The VA share of total applications increased to 11.6 percent from 11.2 percent the week prior. The USDA share of total applications increased to 0.7 percent from 0.6 percent the week prior.

“Mortgage applications continued to remain at a 22-year low, held down by significantly reduced refinancing demand and weak home purchase activity,” said Joel Kan, MBA Associate Vice President of Economic and Industry Forecasting. “Last week’s purchase results varied, with conventional applications declining 2 percent and government applications increasing 4 percent, which is potentially a sign of more first-time homebuyer activity. The average purchase loan size continued to trend lower, as purchase activity at the high end of the market is weakening.”

MBA reported the average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($647,200 or less) increased to 5.65 percent from 5.45 percent, with points increasing to 0.68 from 0.57 (including origination fee) for 80 percent loan-to-value ratio loans. The effective rate increased from last week.

The average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances (greater than $647,200) increased to 5.28 percent from 5.14 percent, with points increasing to 0.58 from 0.33 (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 increased to 5.43 percent from 5.38 percent, with points increasing to 1.10 from 1.01 (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 increased to 5.01 percent from 4.87 percent, with points increasing to 0.84 from 0.64 (including origination fee) for 80 percent LTV loans. The effective rate increased from last week.

The average contract interest rate for 5/1 adjustable-rate mortgages increased to 4.81 percent from 4.43 percent, with points increasing to 0.74 from 0.43 (including origination fee) for 80 percent LTV loans. The effective rate increased from last week.

The ARM share of activity decreased to 6.5 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.