Mortgage Applications Decrease Slightly as Interest Rates Climb
Mortgage applications declined for the third consecutive week as fewer borrowers are choosing to refinance due to rising interest rates.
Loan application volume fell for the period ending Nov. 7 by 0.9% compared to a week earlier, according to data from the Mortgage Bankers Association. Last week, the market composite index was down 2.6% on a seasonally adjusted basis.
The refinance gauge dropped 2% week over week, while the purchase index rose 1% during this time period, the Washington-based trade group said.
The refinance share of mortgage activity remained at 63% of total applications. The adjustable-rate mortgage share decreased to 7.1% of all applications, its lowest level since January. Federal Housing Administration loan applications accounted for 9.6% of all mortgage activity, while Veterans Affairs applications represented 11% and the USDA share was 0.9%.
The average contract interest rate for a 30-year fixed mortgage increased two basis points, to 4.19%. A 30-year mortgage backed by the FHA was up to 3.9% from 3.84% the week before. Both 30-year jumbo mortgage loans and 15-year fixed mortgage saw its average contract interest rates remain unchanged from the previous week at 4.13% and 3.38%, respectively.
The MBA's weekly survey covers more than 75% of all U.S. retail residential mortgage applications.