Despite a sizeable jump in interest rates, mortgage applications last week continued to rise, the Mortgage Bankers Association reported today.
The market composite index, a measure of total home loan volume, was up 1.1 percent on a seasonally adjusted basis from the week before. While refinancings took another hit, falling 3 percent from the last week of June, the index that tracks home purchases grew 3.8 percent, which pushed overall applications higher.
As a result, the refinance share of applications decreased to 36.2 percent from 37.8 percent the previous week, and the adjustable-rate mortgage (ARM) share dropped from 21 percent to 20.4 percent.
Interest rates posted significant growth last week, according to MBA, with the average rate for 30-year fixed-rate mortgages rising to 6.65 percent from 6.5 percent, the 15-year fixed-rate average growing to 6.31 percent from 6.2 percent, and the one-year ARM rate up to 5.6 percent from 5.49 percent.
Points, or loan-processing fees expressed as a percent of the total loan amount, averaged 1.52 on the 30-year loans, 1.41 on the 15-year, and 1.16 on one-year ARMs. These points include the origination fee and 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.