MBA: Mortgage Applications Slide Down to Start October

After having a banner week at the end of September, mortgage applications experienced a decrease to kick off October, the ""Mortgage Bankers Association"":http://www.mortgagebankers.org/default.htm (MBA) reported Wednesday.

[IMAGE]

The Market Composite Index, a measure of mortgage loan application volume, fell 1.2 percent for the week ending October 5, according to a release from the association. The previous week had seen a 16.6 percent increase in applications. The Refinance Index also decreased, falling 2 percent from the previous week.

The Purchase Index came out ahead in the survey, increasing 2 percent.

""Refinance applications declined somewhat last week although volume is still near three-year highs, and purchase applications increased to the highest level since June, with both conventional and government volumes increasing,"" said Mike Fratantoni, MBA's VP of research and economics.

While refinance activity backed off from the previous index, the refinance share of mortgage activity remained flat at 83 percent. Meanwhile, the adjustable-rate mortgage share of activity dropped to 3.9 percent of total applications, matching its lowest level since December 2009.

The government share of purchase applications remained at 35.5 percent, hovering at its lowest level since MBA's Weekly Mortgage Applications Survey started.

While mortgage rates have shown a slight bounce following the September jobs report, many analysts-Fratantoni included-say it's a good time for qualified borrowers.

""Rates on 30-year fixed-rate loans remain historically low, benefitting both prospective homebuyers and those seeking to refinance,"" Fratantoni said.