Mortgage Applications Dipped Slightly Last Week as Rates Increased

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Mortgage application volume basically held steady, dipping 0.6% during the week ended October 16, according to the Mortgage Bankers Association’s (MBA) Weekly Applications Survey.

Applications for refinances increased 0.2% while applications for purchases decreased 2%.

Year-over-year, applications for refinances were up 74% while applications for purchases were up 26%.

On an unadjusted basis, total volume decreased 1% compared with the previous week. 

“Mortgage rates increased last week, with the 30-year fixed rate climbing two basis points to 3.02 percent – the highest since late September,” says Joel Kan, associate vice president of economic and industry forecasting for the MBA, in a statement. “Despite the uptick in rates, refinance activity held steady, with FHA refinance applications posting a 17.6 percent increase, helping to offset declines in the other loan types.”

“Homebuyer demand remains strong this fall, but purchase applications did decrease two percent, with both conventional and government purchase activity taking a step back,” Kan adds. “Given the ongoing housing market recovery and low rate environment, both purchase and refinance applications remained robust compared to a year ago, rising 26 percent and 74 percent, respectively.”

The refinance share of mortgage activity increased to 66.1% of total applications, up from 65.6% the previous week.

The adjustable-rate mortgage (ARM) share of activity decreased to 1.9% of total applications.

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