A second consecutive downturn in refinancing volume during the week ended September 22 offset one of the best weeks for purchase mortgage applications since mid-summer.  As a result, the Market Composite Index, a measure of application volume, also posted a second week of losses.  The Mortgage Bankers Association (MBA) said that index was down 0.5 percent from one week earlier and declined 1 percent on an unadjusted basis.  

According to the seasonally adjusted Purchase Index, purchase applications were up 3 percent from one week earlier and they increased 2 percent on the unadjusted index.  The latter was 4 percent above its levels during the same week in 2016. Refinancing declined by 4 percent from the prior week and the share of applications that were for refinancing fell to 50.8 percent of total applications from 52.1 percent.

Refi Index vs 30yr Fixed

Purchase Index vs 30yr Fixed

The share of applications submitted for non-GSE (Fannie Mae and Freddie Mac) mortgages continues to retreat.  FHA applications decreased to 9.6 percent of the total from 9.9 percent and VA loans were at 10 percent, down 0.1 point. The USDA share was unchanged at 0.7 percent.

Interest rates increased for all loan types on both a contract and an effective basis. The average rate for 30-year fixed-rate mortgages (FRM) with conforming loan balances of $424,100 or less rose to 4.11 percent from 4.04 percent. Points were unchanged at 0.40.  

Jumbo 30-year FRM, loans with origination balances greater than $424,100, had an average rate of 4.06 percent, up from 3.99 percent the previous week.  Points increased to 0.26 from 0.23

The average contract interest rate for 30-year FRM backed by the FHA ticked up 1 basis point to 3.98 percent.  Points jumped to 0.50 from 0.34.

Fifteen-year FRM had an average rate of 3.38 percent with 0.40 point.  During the week ended September 15 the average contract rate was 3.35 percent with 0.44 point.

The average contract interest rate for 5/1 adjustable-rate mortgage (ARMs) increased to 3.38 percent from 3.30 percent, with points increasing to 0.45 from 0.34. During the week, 6.5 percent of applications received were for ARMs, down from a 6.8 percent share the week before.  

MBA's Weekly Mortgage Applications Survey has been conducted since 1990 and covers over 75 percent of all U.S. retail residential mortgage applications.  Respondents include mortgage bankers, commercial banks and thrifts.  Base period and value for all indexes is March 16, 1990=100 and interest rate information is based on loans with an 80 percent loan-to-value ratio and points that include the origination fee.