The Mortgage Bankers Association (MBA) released its report on mortgage applications Wednesday morning, noting a week-over-week decrease of 3.5% in the group’s seasonally adjusted composite index for the week ending February 20. That followed a drop of 13.2% for the week ending February 13. Mortgage loan rates increased on all five types of loans for the second consecutive week.
On an unadjusted basis, the composite index decreased by 12% week-over-week. The seasonally adjusted purchase index increased 5% compared to the week ended February 13. The unadjusted purchase index fell by 2% for the week and is now 2% lower year-over-year.
Home buying action is typically slow in January and February due to wintry weather. Home price increases have fallen sharply year-over-year, as Tuesday’s Case-Shiller home price index indicated. Interest rates are rising, likely in an effort to attract bond investors.
Adjustable rate mortgage loans accounted for 5.2% of all applications, down from 5.3% in the prior week.
The MBA’s refinance index decreased 8% week-over-week, and the percentage of all new applications that were seeking refinancing declined from 66% in the prior week to 62%.
The FHA share of all applications rose from 15.2% a week ago to 15.3%, and the VA share decreased from 8.0% to 9.6%.
The average mortgage loan rate for a conforming 30-year fixed-rate mortgage increased from 3.93% to 3.99%. The rate for a jumbo 30-year fixed-rate mortgage increased from 3.92% to 4.09%. The average interest rate for a 15-year fixed-rate mortgage increased from 3.24% to 3.28%.
The contract interest rate for a 5/1 adjustable rate mortgage loan rose from 3.09% to 3.28%. Rates on a 30-year FHA-backed fixed rate loan rose from 3.73% to 3.82%.