The MBA’s Market Composite Index, which measures mortgage application volume, fell 1.5% on a seasonally adjusted basis from a week earlier. The index dropped 2% on an unadjusted basis. The Refinance Index rose 0.3% from the previous week, while the seasonally adjusted Purchase Index dropped 4%. The unadjusted Purchase Index fell 4% compared to the previous week, but was still 11% higher than the same week a year ago.
“Mortgage rates increased last week, and Treasury rates increased to a recent high at midweek before falling at the end of the week,” said Mike Fratantoni, MBA chief economist. “Overall purchase activity fell for the week, along with conventional refinance volume, but government refinance volume increased. The level of purchase applications remained 11 percent higher than the same week last year, but the drop this week may indicate borrowers being wary of the recent run up in mortgage rates.”
The refinance share of mortgage applications rose a point, from 51% of total applications to 52%. The adjustable-rate mortgage share also increased, finishing last week at 6.4% of total applications.
The average interest rate for 30-year fixed-rate mortgages with conforming loan balances rose to 4.04% – its highest level since December – from the previous week’s average of 4.00%. the average rate for 30-year FRMs with jumbo loan balances rose to 4.04% from the previous week’s 3.99%.
The average rate for 5/1 ARMs, meanwhile, was down, dropping to 2.99% from the previous week’s average of 3.00%.
Mortgage applications dropped last week while fixed rates hit their highest levels all year, according to new data from the Mortgage Bankers Association.