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Despite Week Decrease, Mortgage Applications Up From Last Year

According to the latest Mortgage Bankers Association weekly survey ending May 31, 2017, mortgage applications decreased since last week’s report. The Market Composite Index, a measure of mortgage loan application volume, decreased 3.4 percent on a seasonally adjusted basis. Unadjusted, the Index decreased 4 percent and the Refinance Index decreased 6 percent. The seasonally adjusted Purchase Index decreased 1 percent while the unadjusted decreased 3 percent. Compared to the same week last year, this is 7 percent higher.

The refinance share of mortgage activity decreased to 43.2 percent of total applications from 43.9 percent the previous week. The adjustable-rate mortgage share of activity decreased to 7.7 percent of total applications. FHA’s share of total applications decreased to 10.5 percent, 0.3 percent lower than the week before. The VA share of total applications increased the same amount from 10.5 last week to 10.8 this week. The USDA share of total applications remained unchanged at 0.8 percent.

The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances, meaning $424,100 or less, stayed at 4.17 percent, according to the MBA. The points decreased from 0.39 to 0.32, including the origination fee, for 80 percent loan-to-value ratio (LTV) loans. The effective rate remained unchanged from last week.

The average contract interest rate for 15-year fixed-rate mortgages decreased to 3.42 percent from 3.45 percent. Points increased from 0.38 to 0.39, including the origination fee, for 80 percent LTV loans.

Both 15-year fixed rate mortgages and 5/1 ARMs effective rate decreased this week. The average contract interest rate for 5/1 ARMs decreased to 3.22 percent from 3.27 percent, with points decreasing to 0.33 from 0.35, including the origination fee.

Freddie Mac also released their weekly mortgage rate report on Thursday for the short week following Memorial Day. Freddie Mac reported that 30-year fixed-rate mortgages (FRM) averaged 3.94 percent with an average 0.5 point for the week ending in June 1, 2017. This is down from last week when it averaged 3.95 percent.

According to Freddie Mac, this week averaged 3.19 percent with an average 0.5 point for 15-year FRM. A year ago at this time, Freddie Mac reported 15-year FRMs averaging 2.92 percent.

Five-year Treasury-indexed hybrid adjustable rate mortgages averaged 3.11 percent with a 0.5 point, up from last week when it averaged 3.07 percent.

About Author: Brianna Gilpin

Brianna Gilpin, Online Editor for MReport and DS News, is a graduate of Texas A&M University where she received her B.A. in Telecommunication Media Studies. Gilpin previously worked at Hearst Media, one of the nation's leading diversified media and information services companies. To contact Gilpin, email brianna.gilpin@thefivestar.com.

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