The Mortgage Bankers Association (MBA) released its weekly report on mortgage applications Wednesday morning, noting a decrease of 2.2% in the group’s seasonally adjusted composite index for the week ending November 15. Mortgage interest rates fell on four of five loan types the MBA tracks.
On an unadjusted basis, the MBA’s composite index decreased by 14% in the past week. The seasonally adjusted purchase index rose by 7% compared with the week ended November 8. The unadjusted purchase index dropped by 8% for the week and was 7% higher year over year.
Mortgage loan rates for a top-tier 30-year fixed-rate loan slipped last week to 3.78%, according to Mortgage News Daily. As of Tuesday night, top-tier borrowers were paying 3.76% for that loan. The week-over-week yield on a 10-year U.S. Treasury note decreased from 1.93% to 1.79% as of last night’s close. A year ago, the 10-year note yielded 3.06%.
Joel Kan, the MBA’s associate vice president of economic and industry forecasting, said:
U.S. and China trade anxieties and protests in Hong Kong pulled U.S. Treasuries lower last week, and the 30-year fixed mortgage rate followed the same path, dipping below 4 percent. Despite lower rates, mortgage applications decreased 2.2 percent, driven by an 8 percent slide in refinance activity. Rates have stayed in the same narrow range of around 4 percent since July, so we may be starting to see the expected slowdown in refinancing as the pool of eligible homeowners shrinks.
The MBA’s refinance index decreased by 8% week over week, and the percentage of all new applications that were seeking refinancing fell from 61.9% to 59.5%.
Adjustable-rate mortgage loans accounted for 4.6% of all applications, down 0.3 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 decreased from 4.03% to 3.99%. The rate for a jumbo 30-year fixed-rate mortgage slipped from 3.98% to 3.93%. The average interest rate for a 15-year fixed-rate mortgage dropped from 3.43% to 3.40%.
The contract interest rate for a 5/1 adjustable-rate mortgage loan rose from 3.40% to 3.51%. Rates on a 30-year FHA-backed fixed-rate loan decreased from 3.85% to 3.80%.