Mortgage Bankers See More Rate-Driven Applications

For the third consecutive week, the Mortgage Bankers Association's Weekly Mortgage Applications Survey found the average rate for the 30-year fixed rate loan to be under 5%, benefiting not only refinance applications but loan purchase applications as well. The Market Composite Index, a measure of loan application volume, increased 16.4% both on a seasonally adjusted basis and on an unadjusted basis for the week ended Oct. 2. MBA noted that the seasonally adjusted Purchase Index increased 13.2% from one week earlier, which puts the index at its highest level since January. Additionally, the seasonally adjusted Government Purchase index is at a record level in the survey after a 14.4% increase from the week before. The Refinance Index increased 18.2% from the previous week. The market share of refinance applications increased to 66.3% of total applications received, up from 65.3% for the previous week. The share of adjustable rate mortgage applications declined to 6.1% for the week, down from 6.2% one week prior. The average contract interest rate for 30-year fixed-rate mortgages decreased to 4.89% from 4.94%, with points increasing from 0.94 to 1.13 (including the origination fee) for loans with an 80% percent loan-to-value ratio, according to the association. The average contract interest rate for 15-year FRMs fell 2 basis points from the previous week, to 4.32%, while for one-year adjustable rate loans, it increased by 16 BP to 6.56%.