Overall mortgage application activity tumbled last week as interest rates continued to climb, the Mortgage Bankers Association reported today.
The market composite index, which measures total home loan volume, dropped 7.3 percent last week on a seasonally adjusted basis from the week before, impacted strongly by a double-digit decrease in refinancings.
The index that tracks refinancings was down 13 percent from mid-May, which cut the refi share of mortgage activity to 39.7 percent of applications, and the purchase index sank 2.5 percent.
The adjustable-rate mortgage (ARM) share of activity decreased to 17.7 percent of applications from 18.1 percent the previous week, according to MBA.
Borrowing costs increased again last week, with the average contract interest rate for 30-year fixed-rate mortgages rising to 6.32 percent from 6.23 percent, the 15-year fixed rate up from 5.96 percent to 6.05 percent, and the one-year ARM growing from 5.72 percent to 5.74 percent.
Points, which are loan-processing fees expressed as a percent of the total loan amount, averaged 1.41 on the 30-year loans, 1.27 on the 15-year, and 1.09 on one-year ARMs. Statistics, which include the origination fee, are based on loan-to-value ratios of 80 percent.
The Mortgage Bankers Association 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.