Mortgage applications dropped 9.6% on a seasonally adjusted basis last week, according to the Mortgage Bankers Association's weekly mortgage applications survey.
During the week ending Aug. 26, the MBA's Market Composite Index fell 10% on an unadjusted basis from the previous week, with the Refinance Index down 12.2% and the seasonally adjusted Purchase Index up 0.9%. The Purchase Index dropped 1.3% on an unadjusted basis compared to the previous week and was down 8.2% from the same week a year ago.
The MBA said the four-week moving average for its seasonally adjusted market index rose 2.5% in the most recent week while that average for the seasonally adjusted Purchase Index dropped 3.8%. The four-week moving average for the Refinance Index rose 4.2%.
Refinancings accounted for 77.8% of applications last week, down from 79.8% the previous week, while the percentage of applications taken out for adjustable-rate mortgages jumped to 7.1% from 6.2%.
Despite rates staying near a 10-month low, this marked the second week of declines for refinancing application volumes in the wake of what had been recent highs. The numbers also show purchase volume is still close to 15-year lows, according to a report by Mike Fratantoni, MBA's vice president of research and economics.
With an increase in average points paid factored in, mortgage rates were largely unchanged last week, he said.
The MBA pegged last week's average contract interest rate for 30-year fixed-rate mortgages at 4.32%, down from 4.39% the previous week, but average points were 1.3 as compared to 0.88 of a point the week before. (The points are based on 80% loan-to-value ratio mortgages and include the origination fee.) Average points remained unchanged at 1% for 15-year FRMs, with the contract interest rate dropping to 3.49% from 3.56%.
