The Mortgage Bankers Association (MBA) released its weekly report on mortgage applications Wednesday morning, noting a decrease of 2.7% in the group’s seasonally adjusted composite index for the week ending March 17. During the week, mortgage loan rate movements were mixed with some rising, some falling and one remaining unchanged.
On an unadjusted basis, the composite index decreased by 2% week over week. The seasonally adjusted purchase index also decreased by 2% compared with the week ended March 10. The unadjusted purchase index decreased by 2% for the week and is now 5% higher year over year.
The MBA’s refinance index decreased by 3% week over week, and the percentage of all new applications that were seeking refinancing slipped from 45.6% to 45.1%.
Adjustable rate mortgage loans accounted for 9% of all applications, up from 8.2% in the prior week.
Mortgage rates have moved back down after reaching a three-year high last week at 4.375% on a 30-year fixed-rate loan. Tuesday’s losses in the equity markets sent traders to the bond markets. More demand for bonds reduces the bond yield which, in turn, lowers mortgage rates. Matthew Graham at Mortgage News Daily explains:
In less than a week, rates have fallen quickly from 3-year highs to the lowest levels of the month. The average lender is still quoting conventional 30yr fixed rates of 4.25% on top tier scenarios, but with lower upfront costs today. Several of the more aggressive lenders are already back down to 4.125%, and fewer laggards remain at 4.375%.
According to the MBA, last week’s average mortgage loan rate for a conforming 30-year fixed-rate mortgage remained unchanged at 4.46%, its highest level since April 2014. The rate for a jumbo 30-year fixed-rate mortgage fell from 4.44% to 4.40%. The average interest rate for a 15-year fixed-rate mortgage increased from 3.66% to 3.68%.
The contract interest rate for a 5/1 adjustable-rate mortgage loan decreased from 3.45% to 3.41%. Rates on a 30-year FHA-backed fixed-rate loan rose from 4.29% to 4.33%, its highest level since January 2014.