Mortgage Applications Decrease in July 19th MBA Weekly Survey

Mortgage applications decreased 1.9 percent from one week earlier, according to data from the Mortgage Bankers Association’s (“MBA”) Weekly Mortgage Applications Survey for the week ending July 19, 2019.

The Market Composite Index, a measure of mortgage loan application volume, decreased 1.9 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index decreased 2 percent compared with the previous week. The Refinance Index decreased 2 percent from the previous week and was 81 percent higher than the same week one year ago. The seasonally adjusted Purchase Index decreased 2 percent from one week earlier. The unadjusted Purchase Index decreased 1 percent compared with the previous week and was 6 percent higher than the same week one year ago.

“Mortgage applications were down last week, even as rates moved lower across the board, with the 30-year fixed rate at 4.08 percent. Refinance activity was lower, but we did see government refinance applications increase, driven solely by a 12 percent rise in FHA applications,” said Joel Kan, MBA’s Associate Vice President of Economic and Industry Forecasting. “Mortgage rates right now are comparable to the average rate of 4.10 percent for June, but refinances last week were 7 percent lower than last month. This is an indication that as we see rates lower for longer, borrowers need more of a drop in rates to consider refinancing.”

Added Kan, “Purchase applications decreased for the second straight week and have been somewhat volatile lately, but were still 6 percent higher than a year ago.”

The refinance share of mortgage activity decreased to 49.8 percent of total applications from 50.0 percent the previous week. The adjustable-rate mortgage (“ARM”) share of activity decreased to 4.7 percent of total applications.

The FHA share of total applications increased to 11.3 percent from 10.6 percent the week prior. The VA share of total applications increased to 13.1 percent from 12.9 percent the week prior. The USDA share of total applications remained unchanged from 0.6 percent the week prior.

The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($484,350 or less) decreased to 4.08 percent from 4.12 percent, with points decreasing to 0.33 from 0.38 (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 with jumbo loan balances (greater than $484,350) decreased to 4.04 percent from 4.07 percent, with points increasing to 0.25 from 0.21 (including the origination fee) for 80 percent LTV loans. The effective rate decreased from last week.

The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA decreased to 3.98 percent from 4.01 percent, with points increasing to 0.31 from 0.28 (including the origination fee) for 80 percent LTV loans. The effective rate decreased from last week.

The average contract interest rate for 15-year fixed-rate mortgages decreased to 3.45 percent from 3.48 percent, with points remaining unchanged at 0.32 (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 3.57 percent from 3.58 percent, with points remaining unchanged at 0.27 (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