Mortgage application volume plummeted 6% during the week ended September 29, as the average contract rate for a 30-year fixed-rate mortgage increased to 7.53%, up from 7.41% the previous week, according to the Mortgage Bankers Association’s (MBA) Weekly Applications Survey.
Applications for refinances decreased 7% compared with the previous week and were down 11% compared with the same week one year ago.
Applications for purchases decreased 6% percent compared with the previous week and were down 22% compared with the same week one year ago.
“Mortgage rates continued to move higher last week as markets digested the recent upswing in Treasury yields,” says Joel Kan, vice president and deputy chief economist for the MBA, in a statement. “Rates for all mortgage products increased, with the 30-year fixed mortgage rate increasing for the fourth consecutive week to 7.53 percent – the highest rate since 2000.
“As a result, mortgage applications grounded to a halt, dropping to the lowest level since 1996,” Kan says. “The purchase market slowed to the lowest level of activity since 1995, as the rapid rise in rates pushed an increasing number of potential homebuyers out of the market. ARM loan applications picked up over the week and the ARM share increased to 8 percent, as some borrowers searched for ways to lower their payments.”
The refinance share of mortgage activity decreased to 31.7% of total applications, down from 31.9% the previous week.
The adjustable-rate mortgage (ARM) share of activity increased to 8% of total applications.
Photo: Scott Graham