Last week’s uptick in interest rates sent the nation’s refinance activity into decline, as mortgage rates climbed to a seven-week high, according to the Mortgage Bankers Association’s weekly Mortgage Applications Survey.
The MBA noted this reading also includes an adjustment for the Labor Day holiday.
“The jump in U.S. Treasury rates at the end of last week caused mortgage rates to increase across the board, with the 30-year fixed-rate mortgage climbing to 4.01%– the highest in seven weeks,” MBA Vice President of Economic and Industry Forecasting Joel Kan said. “Refinancing activity dropped as a result, driven solely by conventional refinances.”
Although the Refinance index did fall 4% from the previous week, the MBA notes that it’s still 148% higher than the same time period in 2018.
The survey also indicates the unadjusted Purchase Index rose 16% from a week ago and is still 15% higher than the same week a year ago. Additionally, the seasonally adjusted Purchase Index ticked up 6% from the week before.
“The purchase index increased for the third straight week to the highest reading since July,” Kan said. “Additionally, the average loan amount on purchase applications increased to its highest level since June. This is a likely a sign that the underlying demand for buying a home remains strong, despite some of the recent volatility we have seen.”
Here’s a more detailed breakdown of this week’s mortgage application data:
- The refinance share of mortgage activity decreased to 57.9% from last week’s 60%.
- The adjustable-rate mortgage share of activity retreated to 5% of total applications.
- The Federal Housing Administration‘s share of mortgage apps moved forward to 10.9% from last week’s 9.3%.
- The Department of Veterans Affairs‘ share of applications increased to 12.7% from last week’s 11.9%.
- The Department of Agriculture‘s share of total applications grew from last week’s 0.5% to 0.6%.
- Mortgage interest rates for 30-year fixed-rate mortgages with conforming loan balances ($484,350 or less) increased from last week’s rate of 3.82% to 4.01%.
- The average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances (greater than $484,350) moved forward from last week’s 3.84% to 4.01%.
- The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA increased to 3.89% from last week’s 3.76%.
- The average contract interest rate for 15-year fixed-rate mortgages rose from last week’s 3.28% to 3.42%.
- The average contract interest rate for 5/1 ARMs grew to 3.54% from last week’s 3.42%.