The resurgence enjoyed by refinancing over the last few weeks subsided a bit in the face of rising interest rates during the week ended October 31.   The Mortgage Bankers Association (MBA) reported that its Market Composite Index, a measure of mortgage loan application volume fell by 2.6 percent on a seasonally adjusted basis from the week before and by 3 percent on an unadjusted basis.

The Refinancing Index was down 6 percent from the week ended October 24 and the refinancing share of all applications eased back from 65 percent to 63 percent. 

Refinance Index vs 30 Yr Fixed

The seasonally adjusted Purchase Index increased 3 percent from one week early and was 1 percent higher on an unadjusted basis but was still 13 percent below its level one year earlier. 

Purchase Index vs 30 Yr Fixed

MBA said the share of mortgages originated for FHA backing increased to 9.5 percent from 8.9 percent the week before while VA mortgages were unchanged at a 10.7 percent share.  Just under 1 percent of applications were for USDA guaranteed loans.

Conforming 30-year fixed-rate mortgages (FRM) with balances of $417,000 or less had a contract interest rate that averaged 4.17 percent with 0.22 point and an effective rate that also increased.  The previous week the rate had been 4.13 percent with 0.21 point.

The jumbo 30-year FRM with balances over $417,000 held steady at an interest rate of 4.13 percent.  Points decreased to 0.11 from 0.13 and the effective rate went down.

The average contract interest rate for 30-year FRM backed by the FHA remained unchanged at 3.84 percent, with points increasing to 0.34 from 0.16.  The effective rate increased from last week.

Fifteen-year FRM saw an average rate increase of 10 basis points, rising to 3.38 percent.  Points increased from 0.24 to 0.31 and the effective rate also increased. 

Applications for adjustable rate mortgages (ARM) fell from an 8.2 percent share the previous week to a 7.4 percent share.  The average contract interest rate for 5/1 ARMs increased to 3.08 percent from 2.94 percent, with points decreasing to 0.33 from 0.43.  The effective rate increased compared to the previous week.

MBA compiles its application and interest rate data from its Weekly Mortgage Applications Survey which it has conducted since 1990.  The survey covers over 75 percent of all U.S. retail residential mortgage applications through respondents which 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 ratio and points which include the origination fee.