Mortgage applications increased 4.2% on an adjusted basis during the week ended September 9, with applications for refinances rising 2% and applications for purchases jumping an impressive 9%, according to the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey.
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The adjustable-rate mortgage (ARM) share of activity increased to 4.6 percent of total applications.
On an unadjusted basis, the index decreased 17 percent compared with the previous week. It was 64.0% the previous week.
“Last week, average mortgage interest rates moved down slightly despite a rally in 10-year US Treasury yields that came late in the week”, said Lynn Fisher, MBA’s vice president of Research and Economics.
The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA decreased to 3.5% from 3.52%, while for 15-year fixed-rate mortgages, the average increased to 2.97% from 2.96%.
The short term 15 year fixed rate loan interest rates are published at 2.750% at the bank yielding an April of 2.872%.
The average contract interest rate for 15-year fixed rate mortgages increased to 2.97% from last week’s unchanged 2.96% rate, and points remain unchanged at 0.34 for 80 percent LTV loans.
The Market Composite Index increased by a solid 4.2 percent on a seasonally adjusted basis from one week earlier.
Although rising mortgage rates will tend to undermine activity, there is also the possibility that there will be a rush of buying and re-financing with homeowners looking to lock-in low rates on fears that rates will increase even further over the next few weeks.
The VA share of total applications increased to 12% from 11.9% and the USDA share increased to 0.7% from 0.6%.
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“The purchase market remains supported by an improving USA labor market”.
