The volume of purchase mortgages continued to increase during the week ended March 31, but steadily shrinking refinance numbers once again pulled overall volume down. The Mortgage Bankers Association (MBA) said its Market Composite Index, a measure of loan application activity, declined for the third straight week, decreasing by 1.6 percent from the previous week on a seasonally adjusted basis. On an unadjusted basis the Index fell by 1 percent.
The Refinance Index lost another 4 percent on top of 3 percent losses in each of the previous two weeks. The refinance share of all loan applications decreased to 42.6 percent from 44.0 percent.
The Purchase Index gained 1 percent on both an adjusted and an unadjusted basis compared to the volume during the week ended March 24. The adjusted index has risen in five out of the last six weeks. Purchase volume was up 8 percent compared to the same week in 2016. The average loan size for purchase applications reached a survey high at $318,200.
Adjustable-rate mortgage (ARM) applications had an 8.5 percent share of the total, unchanged from a week earlier. The FHA share of total applications increased to 11.1 percent from 10.8 percent and the VA share ticked up 0.1 percentage point to 11.1 percent. USDA applications held steady at a 1.0 percent share.
Average contract interest rates were mixed during the week, but effective rates were all lower than the week before. The average contract rate for 30-year fixed-rate mortgages (FRM) with conforming loan balances ($424,100 or less) increased to 4.34 percent from 4.33 percent. Points decreased to 0.31 from 0.43.
The jumbo version of the 30-year FRM, loans with balances greater than $424,100, had an average rate of 4.24 percent, down 2 basis points from the previous week. Points dipped to 0.24 from 0.26.
FHA-backed 30-year FRM had an average contract interest rate of 4.15 percent with 0.32 point. A week earlier the rate was 4.24 percent with 0.36 point.
The average contract interest rate for 15-year fixed-rate mortgages was unchanged at 3.57 percent. Points dropped to 0.38 from 0.43.
The average contract interest rate for 5/1 ARMs rose 3 basis points to 3.33 percent. Points were down to 0.13 from 0.28.
MBA's Weekly Mortgage Applications Survey has been conducted since 1990. It covers over 75 percent of all U.S. retail residential mortgage applications with respondents that include mortgage bankers, commercial banks and thrifts. Base period and value for all indexes is March 16, 1990=100 and interest rate data assumes mortgages with 80 percent loan-to-value ratios and points that include the origination fee.