Mortgage Volume Report Mixed; Purchase Applications Post Strong Week; Refinance Activity Falls

WASHINGTON—Mortgage applications decreased 0.5% from one week earlier, according to data from the Mortgage Bankers Association’s Weekly Mortgage Applications Survey released today (Aug. 27) for the week ended Aug. 22.

The Market Composite Index, a measure of mortgage loan application volume, decreased 0.5% on a seasonally adjusted basis from one week earlier.

“Mortgage rates inched higher for the second straight week, with the 30-year fixed-rate up to 6.69%. While this was not a significant increase, it was enough to cause a pullback in refinance applications,” said Joel Kan, MBA’s Vice President and Deputy Chief Economist. “Purchase applications had their strongest week in over a month, up 2%, and the average loan size increased to its highest level in two months at $433,400. Prospective buyers appear to be less sensitive to rates at these levels and are more active, bolstered by more inventory and cooling home-price growth in many parts of the country.”

The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($806,500 or less) increased to 6.69% from 6.68%, with points remaining unchanged at 0.60 (including the origination fee) for 80% loan-to-value ratio (LTV) loans.

The average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances (greater than $806,500) increased to 6.67% from 6.64%, with points decreasing to 0.44 from 0.60 (including the origination fee) for 80% LTV loans.

The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA decreased to 6.35% from 6.39%, with points increasing to 0.80 from 0.66 (including the origination fee) for 80% LTV loans.

The average contract interest rate for 15-year fixed-rate mortgages increased to 6.03% from 5.96%, with points increasing to 0.77 from 0.70 (including the origination fee) for 80% LTV loans.

The average contract interest rate for 5/1 ARMs decreased to 5.94% from 6.01%, with points increasing to 0.68 from 0.63 (including the origination fee) for 80% LTV loans.

The refinance share of mortgage activity decreased to 45.3% of total applications from 46.1% the previous week. The adjustable-rate mortgage (ARM) share of activity decreased to 8.4% of total applications.

The FHA share of total applications remained unchanged at 19.1% from the week prior. The VA share of total applications decreased to 13.3% from 13.4% the week prior. The USDA share of total applications decreased to 0.5% from 0.6% the week prior.