The Mortgage Bankers Association (MBA) released its weekly report on mortgage applications Wednesday morning, noting a decrease of 2.5% in the group’s seasonally adjusted composite index for the week ending March 1. Mortgage interest rates increased on all five types of loans the MBA tracks. MBA data for the prior week included an adjustment for the President’s Day holiday.
On an unadjusted basis, the MBA’s composite index rose by 10% in the past week. The seasonally adjusted purchase index decreased by 3% compared with the week ended February 22. The unadjusted purchase index rose by 11% for the week and was 1% higher year over year.
Mortgage loan rates for a top-tier 30-year fixed-rate loan jumped from 4.49% to 4.57% last week, according to Mortgage News Daily. As of Tuesday night, top-tier borrowers were paying 4.53% for that loan. The yield on a 10-year U.S. Treasury note rose in the past week from 2.67% to 2.72%, as of last night’s close. A year ago the 10-year note yielded 2.88%.
Mike Fratantoni, MBA Senior Vice President and Chief Economist said:
Slightly higher mortgages rates last week led to a decrease in application volume. Furthermore, the average loan size for purchase applications increased to a record high, led by a rise in the average size of conventional loans. This suggests that move-up and higher-end buyers have so far become a greater share of the spring market. Overall, conventional purchase loans are up 2.1 percent relative to last year, indicating that homebuyers continue to be inspired by the stable rate environment and the modest increase in housing supply.
The MBA’s refinance index decreased by 2% week over week, and the percentage of all new applications that were seeking refinancing dropped from 40.4% to 40.0%.
Adjustable rate mortgage loans accounted for 7.4% of all applications, up 0.1 percentage points compared with the prior week.
According to the MBA, last week’s average mortgage loan rate for a conforming 30-year fixed rate mortgage increased from 4.65% to 4.67%. The rate for a jumbo 30-year fixed-rate mortgage ticked up from 4.40% to 4.41%. The average interest rate for a 15-year fixed-rate mortgage rose from 4.00% to 4.08%.
The contract interest rate for a 5/1 adjustable rate mortgage loan increased from 3.95% to 4.080%. Rates on a 30-year FHA-backed fixed-rate loan increased from 4.64% to 4.66%.