Applications down even as rates continue to drop

by MPA28 May 2014
Mortgage applications were down last week despite falling rates, according to data released by the Mortgage Bankers Association.

The MBA’s Market Composite Index, which measures loan application volume, decreased 1.2% last week on a seasonally adjusted basis. On an unadjusted basis, the index fell 2% from the previous week. The Refinance Index was down 1%, and the seasonally adjusted Purchase Index dropped 1% from the week prior. On an unadjusted basis, the Purchase Index dropped 2%, and was 15% lower than the same week last year.

The refinance share of mortgage activity held steady at 52% of total applications. The adjustable-rate share also remained unchanged at 8%.

Fixed rates, meanwhile, dropped to their lowest levels in months. The average interest rate for 30-year fixed-rate mortgages with conforming loan balances dropped to 4.31% -- the lowest level since June 2013 -- from the previous week’s 4.33%. The average rate for 30-year FRMs with jumbo loan balances also hit its lowest level since June, dropping to 4.23% last week from the previous week’s 4.24%.

The average rate for 5/1 ARMS decreased to 3.13% last week from the previous week’s 3.14%.
 

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