The volume of mortgage applications increased last week for the first time since early September.  The Mortgage Bankers Association (MBA) said its Market Composite Index, a measure of that volume, rose 3.6 percent on a seasonally adjusted basis during the week ended October 13.  It did decline 7 percent on an unadjusted basis from the week ended October 6, a week was shortened by the Columbus Day holiday.  The week's results included an adjustment to account for that event.

The increase in the Composite Index was the result of gains in both refinance and purchase mortgage applications.  The seasonally adjusted Purchase Index was up 4 percent compared to the previous week although the unadjusted version fell 6 percent. The Purchase Index was 9 percent higher than during the same week in 2016.

Refinancing also gained ground, ending a four-week slide. That index rose 3 percent although the share of total applications that were for refinancing ticked down to 48.6 percent from 49.0 percent.

Refi Index vs 30yr Fixed

Purchase Index vs 30yr Fixed

FHA mortgage applications made up 10.4 percent of the total, compared to 10.3 percent the prior week, while the VA share ticked down to 10.5 percent from 10.6 percent.  USDA loans applications increased their share from 0.7 percent to 0.8 percent.

Mortgage interest rates showed little movement from the previous week.  The direction of both contract and effective rates was mixed.

The average contract interest rate for 30-year fixed-rate mortgages (FRM) with conforming loan balances of $424,100 or less decreased to 4.14 percent from 4.16 percent. Points were unchanged at 0.44 and the effective rate declined.  

Rates for the 30-year FRM with jumbo loan balances greater than $424,100 ticked up 2 basis points to 4.13 percent.  Points increased to 0.32 from 0.31 and the effective rate was up.  

The contract interest rate for 30-year FRM backed by the FHA was unchanged from the prior week at 4.00 percent. Although points increased from 0.36 to 0.37 the effective rate also was unchanged.

Fifteen-year FRM had an average rate of 3.45 percent with 0.43 point.  The previous week the rate was 3.44 percent with 0.36 point. The effective rate was also higher than a week earlier.

The average contract interest rate for 5/1 adjustable rate mortgages (ARMs) decreased to 3.31 percent from 3.33 percent. Points decreased to 0.40 from 0.43, drawing the effective rate lower.  ARM applications made up 6.1 percent of all those received, down from 6.6 percent a week earlier.

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.