Mortgage Applications Decrease Slightly in Latest MBA Weekly Survey

Mortgage applications decreased 0.1 percent from one week earlier, according to data from the Mortgage Bankers Association’s (“MBA”) Weekly Mortgage Applications Survey for the week ending November 16, 2018. This week’s results do not include an adjustment for the Veterans’ Day holiday.

The Market Composite Index, a measure of mortgage loan application volume, decreased 0.1 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index decreased 3 percent compared with the previous week. The Refinance Index decreased 5 percent from the previous week to its lowest level since December 2000. The seasonally adjusted Purchase Index increased 3 percent from one week earlier. The unadjusted Purchase Index decreased 1 percent compared with the previous week and was 5 percent lower than the same week one year ago.

“Treasury rates declined last week, as equity markets continued to see large swings amidst investor concerns over global economic growth. As a result, mortgage rates inched back across most loan types, including the 15-year fixed-rate mortgage, 5/1 ARM, and 30-year jumbo mortgage rate. The 30-year fixed-rate mortgage also declined, stopping a run of six straight weekly increases,” said Joel Kan, MBA’s Associate Vice President of Economic and Industry Forecasting. “Mortgage applications saw mixed results last week. The Purchase Index increased to its highest level in five weeks, but despite the pause in rates, refinance activity dropped again and remained at its lowest level since 2000.”

The refinance share of mortgage activity decreased to 38.5 percent of total applications from 39.4 percent the previous week. The adjustable-rate mortgage (“ARM”) share of activity decreased to 7.3 percent of total applications.

The FHA share of total applications increased to 10.7 percent from 10.6 percent the week prior. The VA share of total applications increased to 10.6 percent from 10.1 percent the week prior. The USDA share of total applications remained unchanged at 0.7 percent from the week prior.

The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($453,100 or less) decreased to 5.16 percent from 5.17 percent, with points decreasing to 0.48 from 0.55 (including the origination fee) for 80 percent loan-to-value ratio (“LTV”) loans. The effective rate decreased from last week.

The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA remained unchanged at 5.08 percent, with points increasing to 0.63 from 0.55 (including the origination fee) for 80 percent LTV loans. The effective rate increased from last week.

The average contract interest rate for 15-year fixed-rate mortgages decreased to 4.53 percent from 4.57 percent, with points decreasing to 0.51 from 0.56 (including the origination fee) for 80 percent LTV loans. The effective rate decreased from last week.

The average contract interest rate for 5/1 ARMs decreased to 4.24 percent from 4.45 percent, with points increasing to 0.51 from 0.31 (including the origination fee) for 80 percent LTV loans. The effective rate decreased from last week.

The survey covers over 75 percent of all U.S. retail residential mortgage applications, and has been conducted weekly since 1990. Respondents include mortgage bankers, commercial banks and thrifts. Base period and value for all indexes is March 16, 1990=100.

Contact:

Adam DeSanctis – adesanctis@mba.org – (202) 557-2727

Source: Mortgage Bankers Association