Despite steadily climbing interest rates, mortgage application activity last week rose for the first time since mid-May, the Mortgage Bankers Association reported today.
Hefty declines in refinancings had kept the market composite index — a measure of home loan application volume — in a rut, but last week’s rush on lenders pushed the index up 6.6 percent on a seasonally adjusted basis from the week before.
Applications to purchase homes were up for the second consecutive week, with the purchase index climbing 7.2 percent last week after a 1.5 percent increase two weeks ago. The refinance index gained 5.6 percent last week, after falling more than 19 percent in previous weeks, while its share of mortgage activity held at 38 percent.
The adjustable-rate mortgage (ARM) share of activity increased to 18.7 percent last week from 17.8 percent of total applications at the end of May.
Long-term interest rates were higher for the fourth straight week, with the average rate on 30-year fixed-rate mortgages jumping to 6.61 percent from 6.35 percent and the 15-year fixed rate up to 6.28 percent from 6.13 percent. The one-year ARM, however, saw its average rate drop from 5.74 percent to 5.48 percent, according to MBA.
Points, which are loan-processing fees expressed as a percent of the total loan amount, averaged 1.44 on the 30-year loans, 1.39 on the 15-year, and 1.18 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.