Mortgage application volume drops on less purchase activity

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Mortgage applications decreased 1.9% from one week earlier as purchase activity was down again, according to the Mortgage Bankers Association.

The MBA's Weekly Mortgage Applications Survey for the week ending April 6 found that the refinance index decreased 2% from the previous week.

"Application volume was weak coming out of the Easter holiday, particularly for conventional purchase volume, which fell below last year's level at this time," Mike Fratantoni, the MBA's chief economist, said in a press release. "With mortgage rates little changed, the refinance share fell again to its lowest level in a decade."

The refinance share of mortgage activity decreased to 38.4% of total applications from 38.5% the previous week.

The seasonally adjusted purchase index decreased 2% from one week earlier. The unadjusted purchase index decreased 1% compared with the previous week and was 0.5% lower than the same week one year ago.

Adjustable-rate loan of activity decreased to 6.3% from 6.5%, while the share Federal Housing Administration-guaranteed loans increased to 11% from 10.1% the week prior.

The share of applications for Veterans Affairs-guaranteed loans increased to 10.9% from 10.3% and the U.S. Department of Agriculture/Rural Development share remained unchanged at 0.8% from the week prior.

The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($453,100 or less) decreased 3 basis points to 4.66%. For 30-year fixed-rate mortgages with jumbo loan balances (greater than $453,100), the average contract rate decreased 3 basis points to 4.53%.

The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA decreased 8 basis points to 4.66%. For 15-year fixed-rate mortgages the average rate decreased 1 basis point to 4.08%. The average contract interest rate for 5/1 ARMs increased to its highest level since February 2011, 3.93%, from 3.87%.

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