Applications volume was lower during the week ended August 8 across all of the measures employed by the Mortgage Bankers Association (MBA).  MBA's Market Composite Index decreased 2.7 percent on a seasonally adjusted basis from a week earlier and it was down 3 percent on an unadjusted basis. 

Refinancing retreated to a 54 percent share of all mortgage applications from a 55 percent share during the week ended August 1.  The Refinancing Index was down 4 percent from the previous week reaching the lowest level since May.

Refinance Index vs 30 Yr Fixed

The seasonally adjusted Purchase Index decreased 1 percent from the prior week and was at its lowest point since February.  The unadjusted index lost 2 percent compared to the previous week and was 10 percent below the level during the same week in 2013.  The seasonally adjusted Government Purchase Index fell by 1 percent to the lowest level since 2007.

Purchase Index vs 30 Yr Fixed

Contract interest rates for all products drifted down slightly; most moved only two or three basis points.  Effective rates were lower across the board.

The average contract rate for 30-year fixed-rate mortgages (FRM) with conforming loan balances of $417,000 or less were unchanged at 4.35 percent with 0.22 point.  The jumbo version of the 30-year FRM declined to 4.24 percent with 0.19 point from 4.26 percent with 0.35 point.

Thirty-year FRM backed by the FHA had a contract rate that averaged 4.04 percent, down from 4.06 percent the previous week.  Points increased to 0.03 from 0.02.

The average rate for a 15-year FRM was 3.48 percent with 0.30 point during the week ended August 8.  The previous week the rate averaged 3.51 percent with 0.28 point.

The share of applications that were intended for adjustable rate mortgages (ARM) increased slightly but stayed in the 8 percent range where it has hovered since near the beginning of the year.  The average contract rate for the most popular ARM, the 5/1 hybrid, decreased to 3.24 percent from 3.32 percent with points increasing to 0.45 from 0.35. 

MBA derives its data from a Weekly Mortgage Applications Survey which it has conducted since 1990.  The survey covers over 75 percent of all U.S. retail residential mortgage applications and respondents include mortgage bankers, commercial banks and thrifts.  Base period and value for all indexes is March 16, 1990=100.  Interest rate quotes are based on loans with a loan-to-value ratio of 80 percent and points include the origination fee.