Mortgage Bankers Association

The recent spike in interest rates has also led to elevated ARM activity, which accounted for over 10% of all applications.

The average purchase loan amount rose as a brief increase in demand for government-sponsored loan programs cooled.

Applications for these federal-backed loans headed upward after the Labor Day holiday but were offset by slowing conventional activity, sending overall volumes down for a fifth consecutive week, according to the Mortgage Bankers Association.

Declines in both purchases and refinances contributed to fractionally lower activity, as rising interest rates provided no relief.

Purchases have dropped in the last eight out of the last nine MBA weekly surveys, but decreased competition is leading to a pickup in the share of FHA originations.

Government-backed applications picked up despite rising rates last week, but a decline in conventional loans drove overall volumes down.

Activity is coming in at or below 2020 levels according to reports from the Mortgage Bankers Association and Redfin.

Numbers decreased for both purchases and refinances, which also saw the slowest pace of activity in over 20 years.

But volumes are still at least 80% lower from a year ago, while mortgage applications overall came in flat.

Loan availability also took its steepest monthly dive since the first months of the coronavirus pandemic, with jumbo products falling off by more than 13%, according to the Mortgage Bankers Association.

Refinances inched up 2% as interest rates dipped, but accounted for only 31% of activity, compared to two-thirds a year ago.

Average purchase sizes have also fallen by almost 11% after reaching a record high this spring.

Purchases and refinances both came in lower, with overall volumes 60% below numbers from a year ago.

New single-family home mortgage applications, housing starts and industry sentiment all came in at their lowest since 2020.

Although refinances picked up after the July 4th holiday, they failed to offset a larger decline in purchases.

Jumbo and adjustable-rate offerings increased during the month, but that was offset by a decline in government loans, leading to an overall drop in MBA’s credit availability index.

Average purchase-loan amounts shrank for the second week in a row and are currently 12% below their record size in March.

Overall mortgage volumes flattened last week, but average loan amounts, particularly for purchases, are shrinking according to the Mortgage Bankers Association.

But total volume is still 53% below last year’s level, while Fannie Mae found the dollar value of refinances down by over 70%.

The industry veteran serves on Mortgage Bankers Association board of directors and co-leads its IMB executive council.