Mortgage application volume down, but refi activity remained high: MBA
Mortgage applications decreased by 3.4% this week, although refinance activity remained close to its 2019 high point, according to the Mortgage Bankers Association.
The MBA's Weekly Mortgage Applications Survey for the week ending June 14 found that the refinance index decreased 4% from the previous week.
The refinance share of mortgage activity increased to 50.2% of total applications from 49.8% the previous week.
"After seeing a six-week streak, mortgage rates for 30-year loans increased slightly, which led to a pullback in overall refinance activity," Joel Kan, the MBA's associate vice president of economic and industry forecasting, said in a press release. "Borrowers were sensitive to rising rates, but the refinance share of applications was still at its highest level since January 2018, and refinance activity was at its second highest level this year. Government refinances actually increased last week, led by a 17% in VA refinance applications, while conventional refinance applications decreased 7%."
The seasonally adjusted purchase index decreased 4% from one week earlier, while the unadjusted purchase index decreased 5% compared with the previous week and was 4% higher than the same week one year ago.
"Purchase applications decreased more than 3% last week, but were still up almost 4% from last year," Kan added. "Strong demand from first-time buyers and low unemployment continue to push this year's purchase activity above a year ago."
Adjustable-rate loan activity decreased to 6.1% from 7.9% of total applications, while the share of Federal Housing Administration-insured loan applications increased to 9.4% from 8.9% the week prior.
The share of applications for Veterans Affairs-guaranteed loans increased to 11.9% from 11% and the U.S. Department of Agriculture/Rural Development share decreased to 0.5% from 0.6% the week prior.
The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($484,350 or less) increased 2 basis points to 4.14%. For 30-year fixed-rate mortgages with jumbo loan balances (greater than $484,350), the average contract rate remained unchanged at 4.04%.
The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA increased 3 basis points to 4.12%. The average contract interest rate for 15-year fixed-rate mortgages decreased 3 basis points to 3.5%. The average contract interest rate for 5/1 ARMs increased 2 basis points to 3.45%.