The Mortgage Bankers Association (MBA) released its weekly report on mortgage applications Wednesday morning, noting a rise of 8.1% in the group’s seasonally adjusted composite index for the week ending September 27. Mortgage interest rates fell on four of five loan types the MBA tracks.
On an unadjusted basis, the MBA’s composite index increased by 8% in the past week. The seasonally adjusted purchase index rose by 1% compared with the week ended September 20. The unadjusted purchase index also rose by 1% for the week and was 10% higher year over year.
Mortgage loan rates for a top-tier 30-year fixed-rate loan dipped from 4.12% to 3.75% last week, according to Mortgage News Daily. As of Tuesday night, top-tier borrowers were paying 3.67% for that loan. The week-over-week yield on a 10-year U.S. Treasury note slid from 1.65% to 1.63% as of last night’s close. A year ago, the 10-year note yielded 3.09%.
Joel Kan, MBA’s associate vice president of economic and industry forecasting, said:
Although refinance activity slowed in September compared to August, the months together were the strongest since October 2016. The slight changes in rates are still causing large swings in refinance volume, and we expect this sensitivity to persist. Purchase applications also increased and remained more than 9 percent higher than a year ago. Low rates and healthy housing market fundamentals continue to support solid levels of purchase activity.
The MBA’s refinance index increased by 14% week over week, and the percentage of all new applications that were seeking refinancing rose from 54.9% to 58.0%.
Adjustable-rate mortgage loans accounted for 5.5% of all applications, up by 0.5 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 slipped from 4.02% to 3.99%. The rate for a jumbo 30-year fixed-rate mortgage dipped from 4.00% to 3.98%. The average interest rate for a 15-year fixed-rate mortgage decreased from 3.46% to 3.43%.
The contract interest rate for a 5/1 adjustable-rate mortgage loan rose from 3.39% to 3.42%. Rates on a 30-year FHA-backed fixed-rate loan dropped from 3.90% to 3.79%.