Refinancing Downturn Leads to Drop in Application Volume: MBA

The downturn in the refinance market led to a decline in total mortgage applications last week, according to the Mortgage Bankers Association.

Mortgage loan applications fell 3.3% on a seasonally adjusted basis, for the week ending March 11, compared to a week ago, the MBA said in its Market Composite Index, its weekly report on application volume. The refinance index fell 6% and the purchase index rose 0.3%.

As a share of overall mortgage activity, refinancings dropped to 55% from 56.7%. The 55% mark is the lowest level of refinance volume since August. The adjustable-rate mortgage share fell to 4.9% of all applications.

The FHA share fell 3 basis points to 11.7%, the VA mortgage share fell 3 basis points to 12.3% and the USDA share was unchanged at 0.8%.

The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($417,000 or less) rose 5 basis points to 3.94%. The average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances rose 5 basis points to 3.86%. FHA fixed-rate 30-year mortgages rose 6 basis points to 3.77%.