Effects of Lower Rates Muted by Holiday in Applications Survey

by devteam July 8th, 2015 | Share

The drop in interestrnrates during the week ended July 3 sent mortgage application volume higher on a<bseasonally adjusted basis but the shortened week occasioned by the IndependencernDay holiday meant that unadjusted volume was down appreciably.</p

Total application volumernas measured by the Mortgage Bankers Association’s (MBA’s) seasonally adjustedrnMarket Composite Index was up by 4.6 percent compared to the week ended Junern26.  The data included an additionalrnadjustment to account for the holiday. rnWhen unadjusted, however, the volume fell by 6 percent.  </p

The Refinance Index,rnwhich is not adjusted, increased 3 percentrnfrom the previous week but thernshare of all applications that were for refinancing dropped to 48.0 percent fromrn48.9 percent.  It was the lowest marketrnshare for refinancing since June 2009. </p

The seasonally adjusted Purchase Index</bincreased 7 percent from the previous week but was down 4 percentrnunadjusted.  The unadjusted index was 32rnpercent higher than during the same week in 2014. </p

Refinance Index vs 30 Yr Fixed</p

ChartManager.loadChart(‘refiappschart’, ‘RefiMtgAppChart’);


Purchase Index vs 30 Yr Fixed</p

ChartManager.loadChart(‘purchaseappschart’, ‘PurchaseMtgAppChart’);


FHA loans constituted 13.7 percent of all applications,rndown from 14.0 percent the prior week and VA loans were unchanged at 10.8rnpercent.  USDA loans dipped to a 0.9rnpercent share from 1.0 percent a week earlier. </p

Mortgage interest rates, both contract andrneffective, decreased for all loan products tracked by the MBA’s Weekly MortgagernApplication Survey.  The average contractrninterest rate for 30-year fixed-rate mortgages (FRM) with conforming loan balances ($417,000rnor less) decreased to 4.23 percent from 4.26 percent the week before.  Points increased to 0.37 from 0.33. </p

Thirty-year jumbo FRM (with openingrnbalances greater than $417,000) carried an average contract interest rate of 4.18 percent, down from 4.21 percent. rnPoints decreased to 0.30 from 0.38.  </p

The rate for 30-year FRM backed by the FHArndecreased to 4.01 percent from 4.04 percent.  Points were unchanged at 0.18. </p

The average contract interest rate forrn15-year FRM decreased three basis points to 3.41 percent.  Points were unchanged at 0.31.</p

Thernshare of adjustable rate mortgage (ARM) applications increased from a 7.0 to arn7.1 percent share.  The average contractrninterest rate for 5/1 ARMs was 3.03 percent compared to 3.09 percent the weekrnbefore and points declined to 0.37 from 0.45.</p

MBA’s survey covers over 75 percent of all U.S. retail residential mortgage applications, and has been conducted since 1990. Respondents include mortgage bankers,rncommercial banks and thrifts. Base period and value for all indexes isrnMarch 16, 1990=100 and interest raterninformation presumes a loan with an 80 percent loan-to-value ratio and pointsrnthat include the origination fee.

All Content Copyright © 2003 – 2009 Brown House Media, Inc. All Rights Reserved.nReproduction in any form without permission of is prohibited.

About the Author


Steven A Feinberg (@CPAsteve) of Appletree Business Services LLC, is a PASBA member accountant located in Londonderry, New Hampshire.

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