Applications for mortgages, both for home purchases and refinancing, declined during the week ended December 8.  The Mortgage Bankers Association (MBA) said its Market Composite Index, a measure of loan application volume, was down 2.3 percent on a seasonally adjusted basis compared to the volume a week earlier.  On an unadjusted basis, the Index decreased 4 percent.

Applications for purchases decreased 1 percent on a seasonally adjusted basis from the week ended December 1, and the unadjusted version of the Purchase Index was down 6 percent.  The unadjusted index remained 10 percent higher than during the same week in 2016.

The Refinance Index was 3 percent lower than the prior week, but the share of applications that were for refinancing increased to 52.4 percent from 51.6 percent. It was the second largest share garnered by refinancing thus far in 2017, only slightly below the 53 percent share during the week ended January 13. 

Refi Index vs 30yr Fixed

Purchase Index vs 30yr Fixed

Applications for FHA mortgages increased to 11.8 percent of the week's total from 11.1 percent the previous week. The VA share dipped to 10.3 percent from 10.7 percent and USDA applications decreased to 0.7 percent from 0.8 percent.  

The average contract interest rate for 30-year fixed-rate mortgages (FRM) with conforming loan balances of $424,100 or less increased to 4.20 percent from 4.19 percent.  Points declined to 0.39 from 0.40 and the effective rate was higher than the previous week.

The rate for jumbo 30-year FRM, loans with balances greater than $424,100, averaged 4.11 percent, down from 4.16 percent.  Points were unchanged at 0.28 and the effective rate declined.   

The average contract interest rate for 30-year FRM backed by the FHA was the highest since April, 4.13 percent with 0.39 point, and the effective rate moved higher.  The prior week the rate was 4.11 percent with 0.40 point.  

Fifteen-year FRM rates rose to the highest average level since March, 3.61 percent compared to 3.59 percent the prior week.  Points were down from 0.48 to 0.44, but the effective rate increased.  

The average contract interest rate for 5/1 adjustable rate mortgages (ARMs) decreased by 6 basis points to 3.42 percent.  Points increased to 0.48 from 0.46 and the effective rate moved lower.  The ARM share of applications decreased to 5.6 percent from 5,7 percent.  

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.