A drop in interest rates last week pushed overall mortgage applications up 5.9 percent on a seasonally adjusted basis from the previous week, the Mortgage Bankers Association reported today.

The MBA’s seasonally adjusted purchase index increased by 6.5 percent to 414.2 from 389 the previous week, and the refinance index increased by 5 percent to 1,423.9 from 1,356 one week earlier.

The adjustable-rate mortgage share of activity increased to 29.5 percent of total applications from 29.1 percent the previous week, which pushed the refinance share of mortgage activity down to 35 percent of total applications from 35.3 percent the previous week, MBA reported.

The average contract interest rate for 30-year fixed-rate mortgages decreased to 6.8 percent from 6.86 percent, while points including the origination fee increased to 1.13 from 1.10 for 80 percent loan-to-value ratio loans.

Points, which are fees charged by lenders for loan processing, are expressed as a percent of the total loan amount.

The average contract interest rate for 15-year fixed-rate mortgages decreased to 6.41 percent from 6.49 percent, with points including the origination fee increasing to 1.12 from 1.04 for 80 percent loan-to-value ratio loans.

The average contract interest rate for one-year adjustable-rate mortgages increased to 6.39 percent from 6.36 percent, with points including the origination fee decreasing to 0.78 from 0.87 for 80 percent loan-to-value ratio loans. This is the highest that the one-year rate has been since February 2001, according to MBA.

Washington, D.C.-based Mortgage Bankers Association is a national association representing the real estate finance industry. The survey covers approximately 50 percent of all U.S. retail residential mortgage originations, and has been conducted weekly since 1990. Respondents include mortgage bankers, commercial banks and thrifts.

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