The Mortgage Bankers Association (MBA) released its report on mortgage applications Wednesday morning, noting a week-over-week decrease of 5.5% in the group’s seasonally adjusted composite index for the week ending June 12. That followed an increase of 8.4% for the week ending June 5. For the second consecutive week, mortgage loan rates increased on all five loan types.
On an unadjusted basis, the composite index decreased by 6% week over week. The seasonally adjusted purchase index dropped by 4% compared to the week ended June 5. The unadjusted purchase index decreased 6% for the week, and it remains 15% higher year over year.
The MBA’s refinance index decreased 7% week over week, and the percentage of all new applications that were seeking refinancing remained fell slightly to 48.5%.
The MBA’s chief economist said:
Rising rates continue to create volatility in weekly mortgage applications activity. The 10-year Treasury hit 2.5 percent last week and our survey’s 30-year fixed rate of 4.22 percent is at its highest level since October 2014. The refinance index dropped to the lowest level since January 2015 as rates continued to increase.
Mortgage Daily News reported Tuesday that contract rates are not falling, but that closing costs were being adjusted downward by “many” lenders. Wednesday’s announcement from the FOMC could have an immediate impact on mortgage rates, especially if Fed Chair Janet Yellen even hints at a September rise in the Federal Reserve’s policy rate.
Adjustable rate mortgage loans accounted for 6.5% of all applications, up from 6.3% the prior week.
The average mortgage loan rate for a conforming 30-year fixed-rate mortgage increased from 4.17% to 4.22%. The rate for a jumbo 30-year fixed-rate mortgage increased from 4.15% to 4.18%. The average interest rate for a 15-year fixed-rate mortgage rose from 3.37% to 3.43%.
The contract interest rate for a 5/1 adjustable rate mortgage loan increased from 3.06% to 3.15%. Rates on a 30-year FHA-backed fixed-rate loan rose from 3.9% to 4.0%.