An 18 basis point rise in rates for 30-year fixed-rate mortgages resulted in a decline in mortgage application volume of 14.4% last week on a seasonally adjusted basis, according to new figures released by the Mortgage Bankers Association. The data was not adjusted for Veterans Day.
Refinancing applications are at their lowest level since July, as the index fell 16.5%. Purchase application volume declined for the first time in four weeks, by 5% on a seasonally adjusted basis when compared with last week.
Michael Fratantoni, MBA's vice president of research and economics, commented, "Rates increased sharply last week due to stronger economic data and lingering uncertainty regarding the structure and impact of the Fed's QE2 program. Mortgage applications, particularly for refinances, dropped in response."
The market share of refi applications fell to 80.3% of all new loan activity, down from 81.7% the prior week. MBA tracks activity through its proprietary application index.
MBA reported that the average contract interest rate for a 30-year fixed rate mortgage increased from 4.28% to 4.46%, with points rising to 1.13 from 1.05 (including the origination fee) for loans with an 80% loan-to-value ratio.
For the 15-year FRM rates increased from 3.64% to 3.87%, while points fell from 1.08 to 0.91.
