Mortgage applications increased by 8.4 percent for the week ending June 5, 2015 from one week earlier, according to data from the Mortgage Bankers Association's (MBA) Weekly Mortgage Applications Survey. Last week’s data included an adjustment due to the Memorial Day holiday.
The Market Composite Index, a measure of mortgage loan application volume, increased 8.4 percent on a seasonally adjusted basis from one week earlier, according to the survey. The index increased 19 percent compared to last week on an unadjusted basis. Meanwhile, the refinance index saw an increase of 7 percent from the previous week, and the Purchase Index also increased 10 percent from last week. Increasing by 20 percent from last week, the unadjusted Purchase Index increased by 20 percent and was 15 percent higher than the same week a year ago.
"Mortgage application volume rebounded strongly in the week following the Memorial Day holiday, indicating that the holiday had a larger impact on business activity than originally assumed,” said Mike Fratantoni, MBA's chief economist. “Comparing volume over the past two weeks, purchase activity is up over 6 percent, while refinance activity is down 5 percent. Strong job gains in May and initial signs of wage growth are supporting the purchase market.”
According to the survey, the refinance share of mortgage activity remained unchanged at 49 percent of total applications from previous week, while adjustable-rate mortgage (ARM) share of activity increased to 6.3 percent of total applications. The FHA share of total applications decreased to 14.3 percent from 14.9 percent the week prior. The VA share of total applications decreased to 11.5 percent from 12 percent the week prior, and the USDA share of total applications increased to 1.1 percent from 1 percent the week prior.
The Zillow Mortgage Rate Ticker found that the 30-year fixed mortgage rate on Zillow Mortgages is currently at an eight-month high of 3.96 percent, up eighteen points from this time last week. Yesterday, Zillow predicted that seasonally adjusted MBA Weekly Application Index will show purchase loan activity increased by 2 percent from the week prior, about 6 percent off from the actual number.
The 30-year fixed mortgage rate rose to a high of 3.98 percent on Friday before settling at the current rate, the Ticker determined. The rate for a 15-year fixed home loan is currently 3.09 percent, while the rate for a 5-1 adjustable-rate mortgage (ARM) is 3.01 percent.
Zillow bases its real-time mortgage rates on thousands of custom mortgage quotes that the company receives daily to anonymous borrowers on the Zillow Mortgages site, the company said. Although these rates reflect the most recent changes in the market, they are not marketing rates or a weekly survey.
"Rates jumped sharply last week - first on the heels of news that the European Central Bank's bond buying program may end sooner than expected, then an exceptionally strong U.S. jobs report," said Erin Lantz, VP of mortgages at Zillow. "We expect less volatility in this data-light week."
Click here to view MBA's Weekly Mortgage Applications Survey.
Click here to view Zillow's Mortgage Rates.