Mortgage applications saw a decline by 5.8 percent on a seasonally adjusted basis, compared to last week, according to the latest Mortgage Bankers Association's (MBA) Weekly Mortgage Applications Survey.
"Despite mortgage rates falling across the board last week to their lowest levels in three months, mortgage applications also declined, as more potential borrowers likely stayed away because of ongoing financial market volatility and economic uncertainty," Joel Kan, MBA's AVP of Economic and Industry Forecasting.
The survey, released on Wednesday, revealed a 7 percent decline from last week in mortgage applications on an unadjusted basis. The Refinance Index dropped by 2 percent while the Purchase Index decreased by 7 percent from the week prior. Data indicated a decrease of 10 percent in the unadjusted Purchase Index compared to last week.
The volume of refinance loan applications recorded the highest level since February 2018 increasing to 43.5 percent of total applications. The refinance share of mortgages was at 41.5 percent the previous week. An increase in adjustable-rate mortgage (ARM) activities reflected at 7.9 percent of total applications.
In government loan applications, the FHA decreased to 10.4 percent from 10.8 percent in the past week. The survey revealed a drop in VA share of total applications at 9.9 percent this week compared to 10.2 the week prior. The USDA share of total applications also recorded a decline at 0.6 percent from 0.7 percent the week prior.
Here’s how the average contract interest rates performed for various loans:
- For 30-year fixed-rate mortgages with conforming loan balances decreased to 4.94 percent, the lowest level since September 2018.
- The rate for 30-year fixed-rate mortgages with jumbo loan balances decreased to 4.74 percent, the lowest level since September 2018.
- FHA-backed 30-year fixed-rate mortgages decreased to 4.95 percent, the lowest level since September 2018, from 4.97 percent.
- The 15-year fixed-rate mortgages decreased to 4.37 percent, the lowest level since September 2018, from 4.41 percent.
- The rate for 5/1 ARMs decreased to 4.17 percent from 4.24 percent.
The effective rate for all the above loan types recorded a decrease from last week.