Same Old Story – Rates up, Applications down

Mortgage applications declined yet again during the week ended Junern26.  The Mortgage Bankers Associationrn(MBA) said its Market Composite Index, a gauge of mortgage volume, was down 4.7rnpercent on a seasonally adjusted basis during the week ended June 26 whenrncompared to the week before.  On arnnon-seasonally adjusted basis the index was down 5.0 percent.  Both seasonally adjusted and unadjusted thernComposite Index have lost ground for ten of the last 12 weeks.rn</p

The Refinance Index decreased 5 percentrnfrom the previous week to its lowest level since Decemberrn2014 and the refinance share of mortgage activity ticked down 0.1rnpercent to 48.9 percent. The PurchasernIndex decreased 4 percent from one week earlierrnwhen seasonally adjusted and 5 percent unadjusted.  Despite weeks of declining activity thernunadjusted Purchase Index remained 14 percent higher than during the same weekrnin 2014. </p

Refinance Index vs 30 Yr Fixed</p

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Purchase Index vs 30 Yr Fixed</p

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The FHA share of total applicationsrnincreased from 13.9 percent during the week ended June 26 to 14.0 percent whilernthe VA share declined from 10.9 percent to 10.8 percent.  The USDArnshare increased to 1.0 percentrnfrom 0.9 percent. </p

Average interest rates rose on both arncontract and an effective basis for all loan products tracked by MBA’s MortgagernApplication Survey.  The average contractrninterest rate for 30-year fixed-rate mortgages (FRM) with conforming loan balances ($417,000rnor less) increased to 4.26 percent, the highest level since October 2014, fromrn4.19 percent.  Points decreased to 0.33rnfrom 0.38. </p

The contract rate for 30-year FRM withrnjumbo loan balances (greater than $417,000) increasedrnto 4.21 percent, the highest level since October 2014, from 4.14 percent. rnPoints increased to 0.38 from 0.35. </p

Thirty-year FRM backed by the FHA had an averagerncontract interest rate of 4.04 percent, the highest since September 2014, from 3.96 percent.  Points averaged 0.18 compared to 0.14 a weekrnearlier.</p

The average rate for 15-year FRM srnincreased to 3.44 percent, its highest level since Octoberrn2014, from 3.38 percent.  Points decreased to 0.31 from 0.37.rn </p

The average contract interest rate for 5/1rnadjustable rate mortgages (ARMs) increased 5 basis points to 3.09 percent.  Points dippedrnby 0.01 to 0.45 and ARMs retainedrnthe same 7.0 percent market share of the previous week.</p

MBA’s survey coversrnover 75 percentrnof all U.S. retail residential mortgage applications and has been conductedrnweekly since 1990. Respondentsrninclude mortgage bankers, commercial banks andrnthrifts. Base period and valuernfor all indexes is March 16, 1990=100rnand interest rate data is based on mortgages with an 80 percent loan-to-valuernratio and with points that include the origination fee.

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