Applications Surge as Mortgage Rates Dip to Multi-Month Lows
The Mortgage Bankers Association's latest report on mortgage applications noted a surge in the group's seasonally adjusted composite index.
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The Mortgage Bankers Association (MBA) released its latest report on mortgage applications Wednesday morning. It noted a week over week increase of 25.5% in the group’s seasonally adjusted composite index for the week ending October 2, following a decrease of 6.7% for the week ending September 25. Mortgage loan rates fell last week on all types of fixed-rate mortgages and rose slightly on adjustable-rate loans.
On an unadjusted basis, the composite index increased by 26% week over week. The seasonally adjusted purchase index jumped by 27%, compared with the week ended September 25. The unadjusted purchase index also increased by 27% for the week and is now 49% higher year over year.
The MBA’s refinance index increased by 24% week over week, and the percentage of all new applications that were seeking refinancing fell from 58.0% to 57.4%.
Adjustable rate mortgage loans accounted for 7.6% of all applications, up from 6.9% the prior week.
Mortgage rates dipped to a five-month low last Friday, with some lenders offering 30-year fixed mortgage loans at 3.625%. Rates rose back to around 3.86% on Monday. The 52-week range on 30-year fixed mortgage interest rates is 3.55% to 4.2%, according to Mortgage News Daily.
According to the MBA, last week’s average mortgage loan rate for a conforming 30-year fixed-rate mortgage fell from 4.08% to 3.99%, the lowest level since May. The rate for a jumbo 30-year fixed-rate mortgage decreased from 3.96% to 3.89%, the lowest level since April. The average interest rate for a 15-year fixed-rate mortgage decreased from 3.29% to 3.24%, also the lowest level since May.
The contract interest rate for a 5/1 adjustable rate mortgage loan ticked up from 2.95% to 2.96%. Rates on a 30-year FHA-backed fixed-rate loan fell from 3.87% to 3.80%.
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Paul Ausick has been writing for 247Wallst.com for more than a decade. He has written extensively on investing in the energy, defense, and technology sectors. In a previous life, he wrote technical documentation and managed a marketing communications group in Silicon Valley.
He has a bachelor's degree in English from the University of Chicago and now lives in Montana, where he fishes for trout in the summer and stays inside during the winter.
