Mortgage Loan Rates Slipped Last Week, Refinancings Increased
The Mortgage Bankers Association (MBA) released its weekly report on mortgage applications Wednesday morning, noting a decrease of just 0.1% in the group’s seasonally adjusted composite index for the week ending November 1. Mortgage interest rates slipped on four of five loan types the MBA tracks.
On an unadjusted basis, the MBA’s composite index decreased by 1.0% in the past week. The seasonally adjusted purchase index slipped by 3% compared with the week ended October 25. The unadjusted purchase index fell by 4% for the week and was 7% higher year over year.
Mortgage loan rates for a top-tier 30-year fixed-rate loan were unchanged last week at 3.84%, according to Mortgage News Daily. The yield on a 10-year U.S. Treasury note increased week over week from 1.83% to 1.86%, as of last night’s close. A year ago, the 10-year note yielded 3.20%.
Joel Kan, the MBA’s associate vice-president of economic and industry forecasting, said:
U.S. Treasury yields once again exhibited some intraweek volatility before declining sharply toward the end of the week. As a result, mortgage rates decreased, with the 30-year fixed rate falling below 4 percent again. In response to the lower rates, refinance applications climbed 2 percent, as homeowners with larger loan balances helped to keep the average refinance loan size elevated.
The MBA’s refinance index increased by 2% week over week, and the percentage of all new applications that were seeking refinancing rose from 58% to 59.5%.
Adjustable-rate mortgage loans accounted for 5.2% of all applications, unchanged compared with the prior week.
According to the MBA, last week’s average mortgage loan rate for a conforming 30-year fixed-rate mortgage decreased from 4.05% to 3.98%. The rate for a jumbo 30-year fixed-rate mortgage dropped from 4.01% to 3.97%. The average interest rate for a 15-year fixed-rate mortgage slipped from 3.40% to 3.38%.
The contract interest rate for a 5/1 adjustable-rate mortgage loan remained unchanged at 3.43%. Rates on a 30-year FHA-backed fixed-rate loan fell from 3.83% to 3.79%.