Refi Applications Hit Highest Level Since May: MBA

Refinance application volume for the week ended Aug. 7 reached its highest level since the end of May, according to the Mortgage Bankers Association's weekly survey of the mortgage industry.

The MBA's seasonally adjusted and unadjusted purchase application indices both decreased 4% on a week-over-week basis although the unadjusted index was 20% higher than the year before. Meanwhile refi applications were up by 3%. This resulted in total mortgage loan application volume increasing a scant 0.1% on a seasonally adjusted basis, the MBA found, though on an unadjusted basis its loan application index dropped by 1%.

Refinancing made up 53.1% of total applications, the association said, up 2% from the week before and the highest level since April. The adjustable-rate mortgage share of application activity remained 6.8%.

The Federal Housing Administration's share of applications shrank to 13.3%, down 50 basis points from the week before. The Department of Veterans Affairs' share of applications increased 80 basis points, to 11.3%, perhaps thanks to a major push by the VA to end veteran homelessness. The U.S. Department of Agriculture's share decreased 10 basis points, to 0.7%, from the week before.

The average contract interest rate for a 30-year fixed-rate mortgage stayed at 4.08% with a 7-basis-point increase to 0.34% on 80% loan-to-value ratio loans. The average contract interest for 15-year fixed-rate mortgages increased 3 basis points to 3.39% with a one-basis-point increase for 80% loan-to-value ratio loans.