The volume of refinance loan applications tumbled to its lowest level since December 2000 as interest rates increased during the week ending May 18, according to the Weekly Mortgage Applications Survey released by the Mortgage Bankers Association.
The Market Composite Index, a measure of mortgage loan application volume, slipped 2.6% percent on a seasonally adjusted basis and decreased 3% on an unadjusted basis. The Refinance Index dropped 4%. The seasonally adjusted Purchase Index fell 2%, while the unadjusted index declined 3%. Compared with the same period in 2017, the unadjusted Purchase Index was 3% higher.
Refinances saw their share of total activity slip during the week to 35.7% of total applications from 35.9% in the previous period. Adjustable-rate mortgages (ARM) accounted for 6.8% of all applications, an improvement from the prior survey.
FHA applications took up 10.3% of all activity, remaining unchanged. The VA share of total applications decreased to 9.8% from 10.3%, while the share of USDA applications remained unchanged at 0.8%.
All average contract interest rates increased during the period, with the rate for 5/1 ARMs increasing to its highest level in the history of the survey, 4.12% from 4.09%, with points decreasing to 0.46 from 0.56 for 80% loan-to-value loans.
Rates for the 30-year fixed-rate mortgage with conforming loan balances averaged 4.86%, increasing to its highest level since April 2011 from 4.77%, with points increasing to 0.52 from 0.50. The average for 30-year fixed-rate mortgages with jumbo loan balances increased to its highest level since September 2013, 4.81% from 4.73%, with points increasing to 0.42 from 0.35.
The average rate for 30-year fixed-rate mortgages backed by the FHA was 4.9%, the highest level since May 2011, up from 4.78%. Points increased to 0.85 from 0.76. Rates for the 15-year fixed-rate mortgage increased to 4.31%, its highest level since February 2011, from 4.2%, with points increasing to 0.56 from 0.53.
Mortgage app volume slips
Mortgage app volume edges down