Mortgage application activity decreased 0.5% from one week earlier as a decline in refinance volume was only partially offset by an increase in purchases.

The Mortgage Bankers Association's Weekly Mortgage Applications Survey for the week ending Sept. 22 found that the refinance index decreased 4% from the previous week. Mortgage rates increased last week in response to yields on the 10-year Treasury note rising 22 basis points between Sept. 7 and Sept. 21.

The refinance application share decreased to 50.8% from 52.1% the previous week.

The seasonally adjusted purchase index increased 3% from one week earlier. The unadjusted purchase index increased 2% compared with the previous week and it was 4% higher than the same week one year ago.

Adjustable-rate loan application activity decreased to 6.5% from 6.8%, while the share of applications for Federal Housing Administration-guaranteed loans decreased to 9.6% from 9.9%.

The share of applications for Veterans Affairs-guaranteed loans decreased to 10% from 10.1% and the U.S. Department of Agriculture/Rural Development share remained unchanged at 0.7%.

The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($424,100 or less) increased to 4.11% from 4.04%. For 30-year fixed-rate mortgages with jumbo loan balances (greater than $424,100), the average contract rate increased to 4.06% from 3.99%.

The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA increased 1 basis point to 3.98, while for 15-year fixed-rate mortgages the average increased 3 basis points to 3.38%.

The average contract interest rate for 5/1 ARMs increased to 3.38% from 3.3%.

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