Mortgage application volume dwindled last week as interest rates increased, the Mortgage Bankers Association reported today.
The group’s market composite index, a gauge of home loan application volume, fell 2.1 percent last week on a seasonally adjusted basis from the final week of January. Leading the decline was a 3 percent drop in the index that tracks refinance applications, followed by a 0.3 percent decrease in the purchase-loan index.
Borrowing costs across all loan types rose last week, MBA reported. The average interest rate for 30-year fixed-rate mortgages increased from 5.61 percent to 5.72 percent; the average rate on 15-year fixed loans climbed from 5.09 percent to 5.18 percent; and the average rate on one-year adjustable-rate mortgages (ARMs) gained from 5.62 percent to 5.72 percent.
Points, or loan-processing fees expressed as a percent of the total loan amount, averaged 1.15 on the 30-year loans, 1.08 on the 15-year, and 0.9 on one-year ARMs. These points include the origination fee and are based on loan-to-value ratios of 80 percent.
According to MBA, the refinance share of mortgage activity decreased to 67.4 percent from 69.2 percent the previous week, while the ARM share rose from 8.8 percent to 9.9 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.