There was a 13.5% decrease in mortgage application volume on a seasonally adjusted basis for the week ended Sept. 6, the primary factor being a 20% drop in the Refinance Index. These data were adjusted to take into account Labor Day.
Purchase application volume decreased 3% on a seasonally adjusted basis compared with the previous week. On an unadjusted basis, it is 7% higher for the same week in 2012.
Stock, bond and mortgage markets have been searching for clues as to where the economy is going, said Keith Gumbinger, vice president of HSH.com.
"The Federal Reserve meets next week to sort it all out," he said. "Odds are good that they will begin to taper purchases of mortgage-backed securities and Treasuries, but probably only by a small amount, perhaps $5 billion, to start. If markets should react favorably, they will probably continue along this modest path during the fall, possibly reducing purchases somewhat more quickly if the economy warrants and markets continue to behave."
HSH.com’s weekly mortgage radar found the average rate for the 30-year fixed-rate mortgage increased by five basis points during the week ended Tuesday, to 4.68%.
Zillow Mortgage Marketplace’s rate tracker finds the 30-year fixed mortgage rate rising over the past week by four basis points to 4.49% as of Tuesday afternoon. Last Thursday, it hit 4.62%.
“Rates hovered near two-year highs last week, but Friday’s weaker-than-expected employment results drove rates back down, erasing earlier gains,” said Erin Lantz, director of Zillow Mortgage Marketplace. “This coming week, we expect rates to remain fairly stable unless developments in Syria rile markets or end-of-the-week economic reports are exceedingly positive.”
According to the MBA application survey, the average contract rate for the 30-year conforming FRM (MBA defines this as a loan with a balance of $417,500 or under) for the survey period is 4.8%, up seven basis points from the previous week. Federal Housing Administration-insured loans had an average contract rate for the week of 4.56%, an increase of eight basis points from the previous week.
Jumbo 30-year FRMs saw the average contract rise by 13 basis points to 4.84%. The MBA said the rate for the 15-year FRM jumped eight basis points to 3.83%.
The share of adjustable-rate mortgages was 7% of the week’s loan applications and the average contract rate for the 5/1 ARM increased 10 basis points to 3.59%.