Mortgage requests returned last week after a strong profit streak. The rising mortgage rates and increasing economic uncertainty were likely perpetrators.
The total mortgage application volume fell 6.2% from the previous week, according to the Mortgage Banks Association’s seasonally adjusted index.
The average contract interest rate for a 30-year fixed-rate mortgage with conforming loan balances rose from 6.67% to 6.72%, below $806,500, and rose from 0.63 to 0.64, including starting fees for a 20% down payment loan. That was the first increase in nine weeks. The rating was 25 basis points higher in the same week last year.
As a result, mortgage refinance applications fell 13% in one week, but 70% higher than the same week a year ago. Refinancing has been making strong profits as interest rates fell earlier this month, but given the record rates seen three years ago, there are still only a few valuable people who can make a profit from refinancing. The base volume is very small, so the proportion is very distorted.
Applications to buy mortgage homes were essentially flat every week, up just 0.1%. They were 6% higher than the same week a year ago.
“We are pleased to announce that we are committed to providing a range of services to our customers,” said Mike Fratantoni, MBA Senior Vice President and Chief Economist. “The growing inventory of homes in the market and stable mortgage rates have supported home buying activities so far.”
Mortgage rates have been a bit lower to start this week, according to another survey with Daily Mortgage News, but they have actually moved around within the roughly 10 basis points range for nearly three weeks. That could change on Wednesday following the latest announcement of the Federal Reserve and its chairman about the unexpected commentary.
