Mortgage applications fell last week as the rates on 30-year fixed-rate mortgages available to borrowers with good credit popped back above 5 percent, reversing nearly three months of falling rates.
The Mortgage Bankers Association said applications for mortgages fell 9.8 percent during the week of Jan. 16 from the previous week, driven by a 12.4 percent decline in applications for refinancings. Applications for purchase mortgages were up 2.5 percent, but refinance applications now account for more than eight in 10 mortgage applications.
Applications for refinancings accounted for 83.3 percent of applications, down from 85.3 percent the previous week.
Freddie Mac said rates for 30-year fixed-rate mortgages this week averaged 5.12 percent with an average of 0.7 point, up from 4.96 percent a week ago. Fixed-rate mortgages followed bond yields higher during a holiday-shortened week, said Frank Nothaft, Freddie Mac vice president and chief economist.
Despite the first increase in 11 weeks, the 30-year fixed-rate mortgage is still significantly below the 5.48 percent rate seen a year ago, and the average rate for the first three weeks in January remained 0.25 percentage points below the average for December.
The 15-year fixed-rate mortgage this week averaged 4.8 percent with an average 0.7 point, up from 4.65 percent last week but down from 4.95 percent a year ago.
Five-year Treasury-indexed hybrid adjustable-rate mortgages (ARMs) averaged 5.24 percent this week with an average 0.6 point, down from 5.25 percent last week but up from 5.13 percent a year ago. The 5-year ARM has not been this low since the week ending Sept. 8, 2005, when it also averaged 5.24 percent.
One-year Treasury-indexed ARMs averaged 4.92 percent this week with an average 0.7 point, up from 4.89 percent last week but down from 4.99 percent a year ago, Freddie Mac said.
The Mortgage Bankers Association said the share of applications for ARM loans increased to 1.5 percent during the week of Jan. 16, up from 1.1 percent the previous week.
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