Mortgage applications increased 1.6% from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending Aug. 20.
The Refinance Index increased 1% from the previous week and was 3% higher than the same week one year ago. The seasonally adjusted Purchase Index increased 3% from one week earlier. The unadjusted Purchase Index increased 1% compared with the previous week and was 16% lower than the same week one year ago.
“Treasury yields fell last week, as investors continue to anxiously monitor if the rise in COVID-19 cases in several states starts to dampen economic activity,” says Joel Kan, the MBA’s associate vice president of economic and industry forecasting. “Mortgage rates slightly declined as a result, with the 30-year fixed rate decreasing for the first time in three weeks. Lower rates led to an increase in refinance applications, with government loan applications jumping 10 percent to the highest level since May 2021.
“Purchase applications for both conventional and government loans also increased,” he continues. “The purchase index was at its highest level since early July, despite still continuing to lag 2020’s pace.”
The refinance share of mortgage activity remained unchanged from the previous week, at 67.3% of total applications The adjustable-rate mortgage (ARM) share of activity decreased to 3.1% of total applications.
The FHA share of total applications increased to 11% from 9.4% the week prior. The VA share of total applications decreased to 10% from 10.3% the week prior. The USDA share of total applications remained unchanged from 0.4% the week prior.
The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($548,250 or less) decreased to 3.03% from 3.06%, with points decreasing to 0.29 from 0.34 (including the origination fee) for 80% loan-to-value ratio (LTV) loans.
The average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances (greater than $548,250) decreased to 3.13% from 3.19%, with points increasing to 0.26 from 0.26 (including the origination fee) for 80% LTV loans.
The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA decreased to 3.1% from 3.15%, with points decreasing to 0.29 from 0.31 (including the origination fee) for 80% LTV loans.
The average contract interest rate for 15-year fixed-rate mortgages decreased to 2.38% from 2.41%, with points increasing to 0.29 from 0.28 (including the origination fee) for 80% LTV loans.
The average contract interest rate for 5/1 ARMs decreased to 2.68% from 2.9%, with points increasing to 0.24 from 0.23 (including the origination fee) for 80% LTV loans.
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